M2DC to acquire Basic Energy

MANILA, Philippines — Real estate firm Map 2000 Development Corp. (M2DC) is expanding into the energy sector by acquiring 67.83 percent of Basic Energy Corp. (BEC) for P2.8 billion.

In a disclosure to the Philippine Stock Exchange yesterday, BEC said M2DC will acquire 9.83 billion shares to be issued out of the increase in the authorized capital stock at a subscription price of P0.285 apiece, totaling P2.8 billion.

This follows the memorandum of agreement (MOA) signed by BEC and M2DC in December last year.

“The subscription price of P0.285 per share, which represents a premium over the par value of P0.25 per share, is a negotiated price agreed upon by the parties, taking into account factors, including the potential growth of BEC, and findings determined from the legal, tax and financial due diligence of BEC by M2DC,” BEC said.

With the entry of M2DC, BEC’s public float would decrease from 66.54 percent to 21.4 percent, while foreign ownership would decline from 7.44 percent to 2.39 percent.

M2DC—which is primarily engaged in real estate acquisition, development, and management—will use BEC as its entry to the energy sector.

“M2DC believes that the company is a perfect vehicle for its investment in the energy sector,” the disclosure read.

Meanwhile, BEC said M2DC’s investment would result in a fresh capital infusion into the company, allowing it to grow and expand its current portfolio of energy-focused projects, including interests in other renewables such as solar, wind, biomass, petroleum and other types of energy projects.

Article and Photo originally posted by Philippine Star last January 1, 2021 12:00am and written by Danessa Rivera. Minor edits have been made by REBPH to cater to its own readers.