SPNEC says P2.7-B IPO ‘fully sufficient’ for 500-MW solar plan

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SOLAR Philippines Nueva Ecija Corp. (SPNEC) said its P2.7-billion initial public offering (IPO) would be “fully sufficient” to fund its 500-megawatt (MW) plant as the company would also consider debt financing.

“We will be constructing the first P1.3-billion worth of plant first so that it gets some operations, it’s de-risked because it’s already connected to the national grid and then get the financing from debt providers to add solar panels to turn the 50 to [225-MW],” Solar Philippines Founder Leandro L. Leviste told BusinessWorld in a virtual call on Wednesday.

SPNEC is a unit of Solar Philippines Power Holdings, Inc. (SPPHI), which form part of the group of companies led by Mr. Leviste that are involved in development, construction and operations of solar power plants.

It is the first company under group to go public. The first P1.3 billion from the net proceeds will be used to build 25% of the plant’s first 225 MW.

Meanwhile, the additional amount raised, or P1.332 billion as stated in its preliminary prospectus, will be used to further acquire land in Nueva Ecija, which it has identified to have the “largest potential” for expansion in the near term.

“We think that it is most accretive to the company to use the money to buy land, make a regain on the revaluation of the land and suddenly have ample equity for the whole [500-MW project], which is partly how we’ve gotten a larger equity base on our larger projects,” Mr. Leviste said.

SPNEC is offering 2.7 billion shares to the public for as much as one peso each.

It is targeting to run its offer period from Dec. 1 to 7, while it aims to list at the stock exchange by Dec. 17 under “SPNEC.”

“Management just thinks that it’s going to be best for the company to push forward the expansion beyond the [500-MW], while securing the debt to complete [the project],” Mr. Leviste said.

Separately on Wednesday, Philippine Rating Services Corp. (PhilRatings) has assigned an issue credit rating of PRS Aa plus, with a stable outlook, to Solar Philippines Tarlac Corp. (Solar Tarlac) on the company’s planned P4.15-billion bonds.

Solar Tarlac, which is jointly owned by SPPHI and Prime Metro Power Holdings Corp., is developing a 150-MW solar plant in Concepcion, Tarlac.

Part of the proceeds of the project bonds will be used to refinance a P2.225-billion loan used to build the company’s 100-MW portion of its solar power plant.

PhilRatings said obligations rated PRS Aa are of high quality and are subject to very low credit risk. A stable outlook means the rating is likely to be maintained or to stay unchanged in the next 12 months. — Keren Concepcion G. Valmonte