SMIC receives approval for acquisition of Tiwi and Mak-Ban geothermal fields, Philippines
As reported this morning in the Philippines, SM Investments Corporation (SMIC) received approval from the Securities and Exchange Commission to acquire the 81% stake of related parties in Allfirst Equity Holdings Inc. (Allfirst) in exchange for shares in SMIC. Allfirst is the holding company for Philippine Geothermal Production Company, Inc (PGPC). The transaction will bring SMIC’s ownership in PGPC to 100%.
The total consideration paid for 81% of Allfirst is P15.76 billion (USD 284 million). The transaction will involve the issuance of 17.44 million new shares to the sellers, equivalent to 1.4% of shares outstanding in SMIC.
In 2021 PGPC delivered $99.4 million in revenues and $48.8 million in net income, equivalent to 1.2% of SMIC 2021 revenues and 5.5% accretion to SMIC 2021 net income respectively. PGPC operates the Tiwi and Mak-Ban steam fields. Tiwi is the first commercial-scale geothermal steam field development in Southeast Asia, followed by Mak-Ban, both in operation since 1979. Together they generate geothermal steam sufficient to produce approximately 300 MW of electricity.
In addition to its two producing steam fields, PGPC also has several other greenfield concession areas for geothermal steam production which it will develop moving forward.
“The acquisition of PGPC is sizeable, accretive to our shareholders, and a strong strategic fit with our portfolio of investments in high growth sectors in the Philippines. It further reinforces the SM Group’s commitment to sustainability, good governance and acting as a catalyst for responsible development in the communities we serve,” said Frederic C. Dybuncio, President and Chief Executive Officer of SMIC.
Source: SM Investments Corp.