MANILA, Philippines—Listed holding firm A Brown Co. Inc. on Friday said that its wholly owned subsidiary would fully acquire DMCI Concepcion Power Corp. from parent firm DMCI Power Corp.
In a disclosure to the Philippine Stock Exchange, A Brown said its newly acquired Palm Thermal Consolidated Holdings Corp. would soon buy 100 percent of the outstanding capital stock of DMCI Concepcion.
A Brown’s other subsidiary, Panay Consolidated Land Holdings Corp., will also acquire 30 hectares of land from DMCI Power.
Due diligence
According to A Brown, the two agreements may only take effect once DMCI Power has complied “with certain conditions precedent, including obtaining the requisite corporate and regulatory approvals, and after the conduct of satisfactory due diligence.”
The acquisition of DMCI Concepcion by A Brown would mean that the holding firm could take over the Consunjis’ planned coal-fired power project.
DMCI Concepcion has a 100-megawatt coal fired power plant project in the pipeline. It was supposed to pursue the project in Iloilo as soon as it had firmed up energy supply agreements with the electric cooperatives on the islands of Panay and Guimaras.
This project, which was already listed by the Department of Energy as among the committed power programs in the Visayas, had also secured the necessary permits and endorsements for construction and operation.
Delays
But delays may have hampered the completion of the project. The P7-billion coal plant was supposed to be fully operational by July 2010.
Earlier this month, A Brown announced that it would acquire equity interests in three companies—Palm Thermal, Panay Consolidated and Hydro Link Projects Corp.
A Brown subscribed to 2.850 million common shares of Palm Thermal, representing 95 percent of the latter’s outstanding capital stock. It also acquired another 3 million common shares of Panay Consolidated, representing 100 percent of outstanding capital stock.
Both Palm Thermal and Panay Consolidated are in the process of incorporation.
A Brown’s new subsidiaries will have the same primary purposes of purchasing acquiring, owning, holding, leasing, selling and conveying property of every kind and description.
Hydro Link
Also, A Brown will acquire all the outstanding capital stock of Hydro Link—a newly incorporated company whose purpose is to engage, conduct and carry on the business of developing, constructing, operating, repairing and maintaining hydro-electrical plants and systems, as well as other power generating or converting stations.
“The funding requirements for (these) investments will be sourced through internally generated funds,” A Brown added.—Amy R. Remo
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