SM Investments takes full control of geothermal firm

Conglomerate SM Investments Corp. of the Sy Group said Tuesday the Securities and Exchange Commissions approved its full acquisition of Philippine Geothermal Production Company Inc. through a P15.76-billion share swap deal.

SMIC said in a disclosure to the stock exchange it received SEC’s approval to acquire the 81-percent stake of related parties in Allfirst Equity Holdings Inc (Allfirst) in exchange for SMIC shares. Allfirst is the holding company for PGPI, which operates the Tiwi and Mak-Ban steam fields.

SMIC said the transaction would bring its ownership in PGPC to 100 percent.

The conglomerate said the deal would enable it to invest directly in clean renewable energy-related production, create value for SMIC’s minority shareholders and ensure the alignment of interests of all shareholders in the geothermal property

“The acquisition of PGPC is sizeable, accretive to our shareholders, and a strong strategic fit with our portfolio of investments in high growth sectors in the Philippines,” said SMIC president and chief executive Frederic Dybuncio.


The transaction involved the issuance of 17.44 million new shares to shareholders of Allfirst, equivalent to 1.4 percent of outstanding shares in SMIC.

PGPC in 2021 posted $99.4 million in revenues and $48.8 million in net income, equivalent to 1.2 percent of SMIC’s 2021 revenues and 5.5 percent accretion to the 2021 net income, respectively.

Tiwi is the first commercial-scale geothermal steam field development in Southeast Asia, followed by Mak-Ban, both in operation since 1979.

Together they generate geothermal steam sufficient to produce approximately 300 megawatts of electricity. The geothermal power plants are being operated separately by Aboitiz Power Corp.

In addition to the two producing steam fields, PGPC has several other greenfield concession areas for geothermal steam production which it will develop in the future.

SMIC is one of the largest conglomerates in the country that has investments in retail, banking and property. It also invests in ventures with high growth opportunities in the emerging Philippine economy.

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