The Securities and Exchange Commission has approved the direct public offering of La Union Electric Co. Inc. (LUECO).
Under the offer, LUECO will sell up to 352,950 common shares priced at P772 per share. The company expects to raise net proceeds of about P251.4 million to fund capital expenditures, finance business expansion, and upgrade facilities and equipment.
Unlike an initial public offering, where a company offers shares to the general public, a DPO is a process in which a company raises capital by selling shares directly to employees, customers, suppliers, or individuals.
The SEC said LUECO will be the second company to successfully register under the streamlined guidelines on Securing and Expanding Capital for PowerGen Operators and Wholesale Electricity and Retail Services, or SEC POWERS.
Based on the latest timetable submitted to the SEC, the DPO will run from Jan. 12 to 16, with shares to be issued no later than Feb. 6.
The offering is being made in compliance with Section 43 of Republic Act No. 9136, or the Electric Power Industry Reform Act. The law requires generation companies to offer and sell at least 15 percent of their common shares to the public.
Penta Capital & Investment Corp. was tapped as the sole underwriter for the offering.
LUECO’s franchise area covers San Fernando City and the municipalities of Bauang and San Juan in La Union. Its distribution system consists of two substations—the Bauang Substation and the Poro Substation—with rated capacities of 20 megavolt amperes (MVA) and 67.5 MVA, respectively, as of the end of 2024.
The SEC has been encouraging energy companies to raise funds through the capital markets. It previously streamlined its approval process for power generation and distribution companies seeking to offer shares to the public.
Several energy firms, particularly those in renewable energy, have listed on the Philippine Stock Exchange. These include NexGen Energy Corp., Alternergy Holdings Corp., Citicore Renewable Energy Corp., Repower Energy Development Corp., and Raslag Corp.
