AC ENERGY Philippines, Inc. said on Wednesday that the Philippine Competition Commission (PCC) had approved the Ayala-led company’s acquisition of a solar farm in Negros Occidental from a group of investors that include a state-led insurer.

In a disclosure to the stock exchange, the Ayalas’ business unit for energy projects in the Philippines said it had received the PCC decision on Feb. 13 stating that the antitrust watchdog finds the transaction “will not likely result in substantial lessening of competition” and resolving “to take no further action with respect” to it.

The deal value was placed by AC Energy Philippines at around P2.772 billion, “subject to adjustments.”

“The amount was the result of negotiations between the sellers and the buyer,” AC Energy Philippines said.

The acquired company, San Carlos Solar Energy, Inc. (Sacasol), owns and operates a 45-megawatt (MW) solar farm in San Carlos City, Negros Occidental. The solar farm is operating under the feed-in tariff system under the Renewable Energy Act of 2008. As such, Sacasol enjoys a steady stream of revenues, usually at higher-than-market rates.

The PCC approval completes AC Energy Philippines’ acquisition of the project for which it signed a purchase agreement on Nov. 11, 2019 with Macquarie Infrastructure Holdings (Philippines) Pte. Ltd., Langoer Investments Holding B.V., and the Government Service Insurance System.

With the deal, a total of 6.996 common B shares and 36.246 redeemable B shares changed hands to give AC Energy Philippines a 70% controlling interest in Sacasol.

“Payment shall be made in cash upon the satisfaction of the agreed conditions precedent,” the buying company said.

AC Energy Philippines said the acquisition advances the company’s “strategic objective” to achieve at least 2 gigawatts, or 2,000 MW, of attributable renewable capacity by 2025.

It said upon the completion of the transaction, the company will be able to increase its cash flow from the San Carlos solar power plant. It also places AC Energy Philippines in a position to be a major player in the renewable energy business.

The sellers are investors in private equity fund Philippine Investment Alliance for Infrastructure (PINAI) that invests in infrastructure assets in the Philippines, among which is Sacasol.

On Wednesday, shares in AC Energy Philippines were unchanged at P2.13 each. — Victor V. Saulon