First Gen Corp. said Tuesday it approved the increase in the company’s authorized capital stock to P13.2 billion from P11.6 billion to raise financing for its projects and settle its debt.
First Gen said in a disclosure to the stock exchange the increase in capital stock would be made through the creation of 160 million Series I preferred shares with a par value of P1 apiece.
The shares will entitle the buyers to cumulative dividends which are non-voting, non-participating and redeemable at the option of the corporation. The dividend rate will be determined by the board of directors.
“The amendment to increase the authorized capital stock will give the corporation increased financial flexibility to raise cash for its various projects and/or to pay debt,” First Gen said.
It said the move will be submitted for stockholders’ approval during the May 13, 2020 annual general meeting.
The board also approved the sale by First Gen of its entire stake in FGEN San Isidro Hydro Power Corp. to wholly-owned subsidiary FG Mindanao Renewables Corp.
This will result in San Isidro Hydro Power being a 100-percent direct subsidiary of FG Mindanao
First Gen said the transaction would make San Isidro a 100-percent direct subsidiary of FGMR, which has a hydropower service contract with the Energy Department for a proposed hydroelectric project in Mindanao.
“The restructuring will allow First Gen Mindanao Hydro Power Corp. to request the DOE for the assignment of the HSC to San Isidro, which will be its 100 percent indirect subsidiary,” it said.
San Isidro Hydro Power is a direct subsidiary of the First Gen and is not operational at the moment.
First Gen is pursuing hydroelectric projects in Nueva Ecija, Bukidnon and Agusan del Norte provinces.
First Gen is the largest company in the country that provides clean and renewable power. Its portfolio of clean energy power plants run on natural gas, geothermal, wind and solar with a combined capacity of 3,492 MW as of end-2019.