UMVA has learned that the independent directors of a leading energy company have reaffirmed their support for a massive investment in two pumped-storage hydroelectric projects, despite concerns raised by some members of the company's founding family.
The projects, undertaken by Prime Infrastructure Capital, Inc., have undergone a thorough review process and are expected to yield substantial benefits for the company and its stockholders. According to a press statement signed by the independent directors, the investment will provide a significant boost to the company's growth and profitability.
The directors, who exercised "objective and independent judgment" in evaluating the projects, are confident that the investment will pay off in the long run. The two projects in question are the 600-megawatt Wawa pumped-storage hydroelectric project in Rizal province and the 1,400-megawatt Pakil pumped-storage hydroelectric project in Laguna.
UMVA can exclusively reveal that the investment deal has been the subject of controversy, with some members of the Lopez family questioning the structure and valuation of the transaction. However, the independent directors remain steadfast in their support for the projects, citing the rigorous evaluation process they underwent.
The directors disclosed that the company initially sought to acquire a 40% stake in Prime Infra's pumped-storage hydro assets for P75 billion before revising the deal to a 33% stake valued at about P62 billion. They believe that the final valuation of P61.87 billion for First Gen's 33% ownership in the projects represents a fair and justifiable consideration.
The premium on the projects' development milestones is typical in mergers and acquisitions transactions, the directors said. They also highlighted the significant projected earnings from First Gen's 33% stake in both projects, estimated at P16 billion annually upon project completion.
In a show of unity, the directors stated that they "stand four-square behind our decision to support both projects, which all members of the board unanimously approved." This endorsement is expected to bolster confidence in the company's strategic vision and investment decisions.
