Employment of the smartest and brightest executives pays. Executives at Ayala Corp. are on the move to recoup its money invested in energy while retaining controlling interest worth several times its original capital investment.
ACEN today announced the potential investment of an affiliate of GIC Private Limited (“GIC”), Arran Investment Pte Ltd, in ACEN, in a deal valued at approximately Php 20bn. The 20 Billion Pesos investment of GIC will be implemented through a combination of subscription to four billion primary shares (via a private placement) and purchase of secondary shares from AC Energy.
The private placement of 4,000,000,000 ACEN shares at a price of 2.97 a share will raise ACEN fresh capital of 11.9 Billion Pesos. What is left of the 20 Billion Pesos investment (around 9.1 Billion Pesos) will be spent purchasing the ACEN shares of AC Energy. AC Energy is a 100% owned subsidiary of Ayala Corporation (AC). The sale of its ACEN shares will give AC around 9.1 Billion Pesos.
Please remember that AC through AC Energy will receive 16,685,800,533 ACEN shares in exchange for its international power and energy assets. That is on top of its existing controlling shares in ACEN.
The Ayala’s with a big controlling interest in ACEN will be growing further ACEN through the 11.9 Billion Pesos fresh funds from GIC and the funds from the public minority shareholders through a stock rights offering.
ACEN will issue 2,267,580,434 shares at PHP2.37 per share. That rights offering will raise fresh capital of 5.4 Billion Pesos from the minority investors. AC will not participate in the rights offer to provide maximum availability of rights shares to the minority stockholders. That means the Ayala’s will not spare any more money to fund ACEN growth.
This shows why you should bet on Ayala Corporation. AC’s portfolio churns out money to AC almost free of costs that is why AC will keep on growing.
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Disclaimer and Disclosure: This analysis is an independent viewpoint on publicly traded stocks in the Philippine market. Accuretti Systems Inc. trades stocks in the Philippine market.