Based on its report to the Philippine Stock Exchange, KKR – through Singapore-based subsidiary, Valorous Asia Holdings – has an initial 452.807 million shares or 12.59 percent stake in First Gen.
This is 40 percent bigger than the maximum 323.8 million shares or nine percent of the company it had initially targeted to purchase in a tender offer last July 1 at a strike price of P22.50 per share.
Market pundits took this as a strong sign of KKR’s interest in First Gen.
With more than 10 percent stake, KKR is considered a “strategic investor” under Philippine Stock Exchange rules.
KKR, which acquired a 40 percent stake in Metro Pacific Investments Corp.’s (MPI) hospital subsidiary for P30 billion in 2019, is keen to take its place in First Gen’s nine-member board of directors led by bilyonaryo Federico R. Lopez.
Other members of the board are Federico’s father, Oscar; his cousin, Gabby; Francis Giles B. Puno; Richard B. Tantoco; Peter D. Garrucho; Jaime I. Ayala; Cielito F. Habito; and Alicia Morales.
First Gen owns the 1,000-megawatt Santa Rita and 500-MW San Lorenzo power plants powered by Malampaya gas. It has a strong balance sheet, with minimal debt, and 90 percent of its capacity is under contract from 2022 to 2024. It is currently building a $200 million to $400 liquefied natural gas (LNG) regasification terminal over the next two years to ensure uninterrupted supply even after Malampaya’s depletion.