June 1, 2018 | 8:02 pm
THE BOARD of directors of Basic
Energy Corp. has approved the creation of preferred shares out of its
authorized capital stock to allow the company to raise funds to support its
projects in the years leading to 2028.
Basic Energy told the stock exchange
on Friday that the move, which requires amending its articles of incorporation,
was approved by the board last May 31.
The company said its target projects
within the 10-year period spanning 2018-2028 “are expected to generate steady
streams of revenues” and the proposed amendment “shall provide an option to
raise funds for these projects, the undertaking of which shall be more
feasible.”
“With more projects, operations is
expected to [be] more robust and vibrant,” the listed energy and exploration
said.
The amendment of the company’s
incorporation papers calls for dividing its authorized capital stocks to seven
billion common shares and three billion preferred shares.
The proposal will not entail an
increase in its capitalization, which will remain at P2.5 billion.
Basic Energy said it has identified
target projects that will require it to raise funds.
Several funding options had been
cited such as, but not limited to, borrowings, corporate notes or bonds,
additional issuance of common shares and issuance of preferred shares.
The company said the last option
requires amending its incorporation papers as the present authorized capital
stock under the existing provision consists only of common shares.
Aside from the creation of preferred
shares, the proposed amendment will include the authority of the board of
directors to determine the features, terms and conditions of each series of
preferred shares. There will be no preemptive rights on the issuance of common
and preferred shares, bonds and other instruments.
The proposal is subject to the
approval of the stockholders during the company’s annual stockholders meeting
on June 27.
Basic Energy previously announced it
is pursuing renewable energy projects in the Philippines and in Thailand with
Thai firm Vintage Engineering Public Co., Ltd. It also disclosed the possible
acquisition of at least a 10% stake in a 25-megawatt (MW) biomass power plant
in Japan.
The company has land bank in parts of
the Philippines, including a 178,634 square-meter (sq.m.) property in San
Fabian, and 415,895 sq.m. in Bolinao, both in Pangasinan. It is considering
solar projects in these properties.
On Friday, shares in the company
were trading higher by 0.45% to P0.225 each. — Victor V. Saulon
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