SM Investments to buy geothermal firm PGPC in ₱15.7B share swap deal

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Metro Manila (CNN Philippines, April 1) — SM Investments Corp. (SMIC) will acquire the Philippine Geothermal Production Company (PGPC) through a multi-billion peso share swap agreement with Allfirst Equity Holdings.

The listed company on Friday announced in a statement that it will issue 17.4 million shares at ₱903.99 each in exchange for an 81% stake from Allfirst, of which PGPC is a subsidiary.

"The transaction will bring SMIC's ownership in PGPC to 100%, and it will be included in SMIC's portfolio investments in future reporting," the SM Group holding firm said.

"This portfolio comprises investments in high growth sectors in the Philippines where SMIC seeks to support market leading companies that benefit from synergies within the ecosystem of the SM Group," it added.

PGPC runs the Tiwi and Mak-Ban steam fields, which can generate about 300 megawatts of electricity. Tiwi is Southeast Asia's first commercial-scale geothermal steam field development, followed by Mak-Ban - with both running since 1979.

SMIC added that the company also has other greenfield concession areas for geothermal steam production that will be further developed ahead.

"As a leading sustainability advocate, SMIC is pleased to invest directly in clean renewable energy-related production, which is a national priority and aligned with our commitments to environmental stewardship and to tackling climate change," SMIC president and chief executive officer Frederic DyBuncio said.

DyBuncio also said renewable geothermal energy forms part of carbon reduction efforts, adding it is aligned with the UN Sustainable Development Goals.

SMIC shares fell 1.21% on Friday, closing at ₱898 apiece.