The deal involved about 1 billion shares or a 9 percent stake in CREC done over several transactions. The count matches purchases made by GSIS from May to late June this year.
The transaction gives GSIS a key stake in CREC, the fast-growing clean power company controlled by Saavedra, while providing Megawide with fresh funds to reduce debt and expand its precast concrete business.
“The transaction is consistent with our intent to value-realize our stake in CREC, at the same time welcoming a suitable and strong partner for CREC, said Saavedra, the chair and CEO of Megawide and chair of CREC.
“This is also aligned with our over arching delivery and de-levering initiative, as proceeds will be used to fund our precast expansion and reduce debt to strengthen the balance sheet and improve liquidity, respectively,” he added.
Megawide said the proceeds will support its balance sheet strategy, with short-term debt expected to decline to around P10 billion by the end of June from P12 billion at the end of March, generating an estimated P250 million to P300 million in annual interest savings.
The transaction covered more than one billion CREC shares sold through several tranches, completing Megawide’s exit from the renewable energy developer.
Megawide earlier reported a 26 percent increase in first-quarter net income to P265 million after cutting nearly P6 billion in short-term debt and improving margins, underscoring the company’s focus on strengthening its balance sheet while funding future growth.
Megawide shares rose 1.25 percent to P4.05 each while CREC slipped 0.22 percent to P4.49 each.
—Edited by Miguel R. Camus
