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Leviste’s Solar Nueva Ecija pulls an IPO bolder than Injap Sia’s MerryMart

Injap Sia pulled the public offering of MerryMart (MM) with a plan to reinvent the supermarket business to modern retail and a relatively small supermarket operation.  MM was offered at 1.0 a share but sizzled to a high of 8.56.  It is now trading at 3.15 levels, but it is still 3.15 times the offering price.

Leandro Leviste’s Solar Philippines Nueva Ecija IPO is much bolder than that of Injap’s MerryMart.  Solar Philippines Nueva Ecija Corporation (SPNEC) has no operating history and track record. Leviste is taking SPNEC public with nothing but a plan to develop a 500MW solar plant and a government-granted Solar Energy Service Contract.

SPNEC received 541.44 million capital from its parent company, Solar Philippines Power Project Holdings. But, this cash was plowed back to affiliates Provincia Investment Corp. (PIC) and LPPHC as Deposits for Land Acquisition, leaving a cash balance of just 0.35 Million as of 30 June 2021.

All of the capital infused by the parent company, Solar Philippines Power Project Holdings, into SPNEC has been mortgaged and used as collateral to the 1 Billion loans of Provincia Investment Corp. to AC Energy (ACEN).  Most of the 541 Million capital received from Solar Philippines was recycled back by SPNEC to Provincia Investment and LPPHC as a deposit for land acquisition, leaving almost nothing for the solar project.

The solar project of SPNEC will be funded by the 2.7 Billion of the market who will take 33% of SPNEC.  Solar Philippines Power Project Holdings will take 67% of SPNEC for their brilliance.

The SPNEC IPO is a significant milestone in the development of the capital market in the country.  Despite the lack of operating history and track record, the IPO was allowed under the Petroleum and Renewable Energy listing and disclosure rules of the Philippine Stock Exchange.  The rules should be expanded beyond petroleum and renewable energy to enable anyone with a brilliant scaleable idea to go to the capital market to fund the commercialization of their ideas.

This SPNEC IPO of Leandro Leviste will surely inspire many with brilliant business plans to pursue their dreams and seek funding from the capital market.

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