A subsidiary of the Manila Electric Company (Meralco) is set to invest P15.9 billion in the Leviste-founded SP New Energy Corporation (SPNEC), aimed at accelerating the development of SPNEC’s upcoming solar-plus-energy storage projects.
MGen Renewable Energy, Inc. (MGreen), Meralco Powergen Corporation’s (MGen) renewable energy development arm, will provide this capital investment by subscribing to 15.7 billion common shares and 19.4 billion redeemable preferred voting shares of SPNEC.
This fresh capital injection by MGreen will be allocated to fund the construction and expansion of solar projects. SPNEC will apply for an increase in authorized capital stock to enable this investment. Upon completion, MGreen will become the controlling shareholder of SPNEC with a total voting interest of 50.5%.
MGreen will take on SPNEC’s plan to develop 3,500 megawatts of solar facilities with 4,000 to 4,500 megawatt hours of energy storage. This renewable energy and storage system will enable SPNEC to supply 850 megawatts of mid-merit capacity to Meralco by the targeted delivery date in 2026.
Meralco Chairman and CEO Manuel V. Pangilinan noted that SPNEC’s renewable energy development plan is set to become one of the world’s largest solar projects, aligning with the Department of Energy’s goal of having 35% of the country’s energy from renewables.
Leandro Leviste, CEO of SPNEC, emphasized that MGreen’s investment will combine Meralco’s capabilities with SPNEC’s solar developments to bring these renewable energy installations to fruition for the benefit of all stakeholders.
Completion of the transaction is subject to various regulatory approvals and conditions precedent, as specified by Meralco. UBS served as the financial advisor to MGreen and Meralco in the deal, with legal advice provided by SyCip Salazar Hernandez and Gatmaitan and Gulapa Law. SPNEC and Solar Philippines were advised by King & Spalding and Picazo Law.