By Myrna Velasco

Listed firm Aboitiz Power Corporation has firmed up its acquisition of the chunk of Ayala group’s AC Energy Inc. thermal power assets in Bataan in a transaction worth US$579.2 million.

The two companies separately disclosed to the Philippine Stock Exchange (PSE) that they signed the share purchase agreement on Wednesday (September 26) – effectively cementing the merger and acquisition (M&A) deal.

The asset purchase was done through Arlington Mariveles Netherlands Holdings B.V., an affiliate of the energy investment arm of the Ayala conglomerate.

According to AC Energy President Eric T. Francia, the sale did not include their thermal assets in Kauswagan, Lanao del Norte which has a capacity of 552 megawatts; and the 270MW South Luzon Thermal Energy Corporation (SLTEC) coal-fired plant in Batangas, its partnership with PHINMA Energy and the affiliate firm of Marubeni Corporation.

Francia said the sell-down accounts for just 35-percent of the AC Energy’s thermal platform – not the full 50-percent as previously targeted and should have been valued at US$1.0 billion.

“After the sale, AC Energy thermal portfolio will decrease from around 1,300MW to around 800MW,” the Ayala executive indicated.

The Aboitiz acquisition basically covered the two power plants in Bataan – the 690MW Mariveles and the 1,336MW Dinginin coal-fired power plant installations.

The company noted that the transaction, once closed with regulatory approvals, will give the Aboitiz group 49-percent voting stake and 60-percent economic stake in AA Thermal Inc., the Ayala group’s investment portfolio on its thermal assets.

Aboitiz Power expounded “closing of the transaction is subject to the satisfaction of certain conditions precedent, including the approval by the Philippine Competition Commission.” No specific date had been given yet on when the relevant parties will be filing the application for PCC approval.

The Aboitiz group said this fresh batch of M&A deal shall increase its beneficial ownership in the Mariveles project to 78.325-percent and the Dinginin project to 70-percent.

The Mariveles plant had been on commercial operations since 2013; while the Dinginin power plant development will be on stream next year.

According to Aboitiz Power Chief Operating Officer Emmanuel V. Rubio, this deal “is part of our strategy to reach our 4,000MW net attributable capacity by 2020 through our balanced energy mix.”