MGEN Renewable Energy, Inc. (MGreen), through its subsidiary SP New Energy Corp. (SPNEC), said global investment firm Actis Rubyred (Singapore) Pte. Ltd. has completed a $600-million transaction to acquire a 40% equity stake in MTerra Solar, MGreen’s solar development platform.
“This landmark investment marks a major step forward in our mission to accelerate the clean energy transition in the Philippines. With MTerra Solar, we are reinforcing our commitment to delivering reliable, sustainable, and cost-effective energy solutions,” Emmanuel V. Rubio, president and chief executive officer (CEO) of MGen and SPNEC, said in a media release on Monday.
“This collaboration with Actis and MGreen strengthens our ability to meet the country’s growing energy demand while advancing a greener and more resilient energy future,” he added.
The deal’s closing follows the share subscription agreement signed in September last year between Terra Solar Philippines, Inc. — the project’s developer and an SPNEC subsidiary — and Actis.
MGreen is the renewable energy arm of Meralco PowerGen Corp., a wholly owned subsidiary of Manila Electric Co. (Meralco). The company holds a controlling stake in SPNEC.
With the signing of the subscription agreement, Actis will officially join the Filipino firms in developing and expanding MTerra Solar, which will include a 3,500-megawatt-peak solar farm and a 4,500-megawatt-hour battery energy storage system once fully commissioned.
“MTerra Solar is a marker of what’s possible in terms of scale and ambition with renewable energy in Southeast Asia. It represents the largest such project in this fast-growing region, and we’re delighted to be partnering with MGreen and MGen to deliver this critical project and accelerate the Philippines’ energy transition,” said Rahul Agrawal, partner and head of energy for Southeast Asia at Actis.
Once completed, the P200-billion MTerra Solar is expected to provide clean energy to approximately 2.4 million households under a 20-year, 850-MW mid-merit power supply agreement with Meralco.
The first phase of the project is scheduled for commercial operations by 2026, with the second phase set for 2027.
A syndicate of the country’s largest banks has committed around P150 billion in project financing.
MTerra Solar is part of MGen’s pipeline of projects aimed at achieving an attributable renewable energy capacity of over 1,500 MW by 2030.
“MTerra Solar began as an ambitious project and is now moving toward making a meaningful contribution to the government’s target of having 35% of the country’s energy sourced from renewables. Our collaboration with Actis is a pathway to achieving clean energy for Filipinos,” said Manuel V. Pangilinan, chairman and CEO of Meralco.
UBS AG Singapore Branch served as financial advisor to SPNEC. Latham & Watkins and Picazo Law acted as international and domestic legal counsel to MGreen and SPNEC. Morgan Stanley served as financial advisor, while Milbank and SyCip Law acted as international and domestic legal counsel, respectively, to Actis.
Sought for comment, Juan Paolo E. Colet, managing director at China Bank Capital Corp., said Actis’ investment “ensures that the necessary equity funding is in place to support the completion of the Terra Solar project.”
“Actis brings well-regarded energy infrastructure expertise that will certainly help Terra Solar execute and manage this massive project,” he said in a Viber message.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera
