MANILA, Philippines — Citicore Renewable Energy Corp. (CREC) of tycoon Edgar Saavedra has raised P5 billion from the sale of its shares in its real estate investment trust to Sy-led SM Investments Corp., unlocking a new era of sustainability for the country’s largest blue chip conglomerate.
CREC on Wednesday said it sold 1.884 billion of its common shares in Citicore Energy REIT Corp. (CREIT) to SM Investments at P2.6534 per share. This represents a 28.79-percent stake in the renewable energy REIT landlord.
“Sustainability is a continued priority for [SM Investments]. That’s why we continue to invest more in sustainable emerging sectors that positively impact the economy, and the renewable energy sector is one of them,” SM Investments president Frederic DyBuncio said in a statement.
Proceeds from the share sale will go to the development of CREC’s pipeline of 1,583 megawatts of solar power projects in eight locations across the country.
CREC, which is slated to list on the local bourse in the second quarter, noted that it would remain the single largest stakeholder in CREIT with a 32.88-percent stake after the transaction.
Trading of CREIT’s shares was suspended on Wednesday prior to the announcement of the transaction.
Funds for CREC solar power projects
BDO Capital and Investment Corp. was the transaction adviser for the sale, according to CREC.
“We believe that the SM Group’s entry and investment into CREIT and the partnership with CREC unlocks potential synergies given the energy requirements of the SM Group,” CREC president and CEO Oliver Tan said in a stock exchange filing.
The Philippine Stock Exchange on Jan. 29 approved CREC’s application for listing via a P12.9-billion initial public offering (IPO). Proceeds will also be used to fund the development of solar projects that CREC aims to launch by the end of the year.
Tan previously said they would earmark P35 billion in capital outlays this year mainly to expand their solar power portfolio.
CREC aims to build 1 gigawatt of solar energy capacity annually as part of its five-year expansion plan.
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The article was originally published in Inquirer.NET and written by Meg J. Adonis.
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