GIC consortium marks partnership to secure future growth of geothermal energy investment

The consortium, known as Philippines Renewable Energy Holdings Corporation (PREHC), is partnering First Gen Corporation as substantial shareholders in Energy Development Corporation (EDC).
The consortium, known as Philippines Renewable Energy Holdings Corporation (PREHC), is partnering First Gen Corporation as substantial shareholders in Energy Development Corporation (EDC).PHOTO: REUTERS

SINGAPORE - A consortium of investors that includes a unit of Singapore sovereign wealth fund GIC has linked up with the parent company of the geothermal energy producer in which it earlier invested.

The consortium, known as Philippines Renewable Energy Holdings Corporation (PREHC), is partnering First Gen Corporation as substantial shareholders in Energy Development Corporation (EDC), GIC said in a statement on Tuesday (Oct 3).

EDC is the world's largest vertically-integrated geothermal company. It is also the largest pure-play renewable energy company in the Philippines, with 1,471 megawatt of clean and renewable power assets under its portfolio.

PREHC in August had launched a successful voluntary offer for 31.7 per cent of EDC's total outstanding voting shares for US$1.3 billion (S$1.8 billion). The consortium comprises funds managed by Macquarie Infrastructure and Real Assets (Mira) and Arran Investment, an affiliate of GIC.

Under the partnership, First Gen's significant experience in the power, utilities and energy sectors in the Philippines will combine with PREHC's extensive global infrastructure expertise to support the long-term growth of EDC, said GIC.

First Gen will also continues to hold a majority stake in EDC, maintaining day-to-day control of the company.

First Gen is a leading power producer in the Philippines that primarily utilises clean and indigenous fuels such as natural gas, geothermal energy from steam, hydro-electric, wind, and solar power. The company currently has 3,489MW under its portfolio of power assets.

Mira and GIC are long-term investors with a track record in both global infrastructure and renewable energy. They own and operate a combined installed capacity of over 11,000 megawatts globally.

"We believe Mira and GIC are the right partners for this juncture in our corporate history: they're long-term and astute capital, they have complementary perspectives and they're willing to help us push the frontiers of innovation as we build EDC into a platform that's well-positioned for a dynamically changing energy landscape," said First Gen and EDC chairman Federico Lopez.

Mr Ang Eng Seng, chief investment officer of infrastructure at GIC, added: "As a long-term investor, we believe EDC's unique portfolio of renewable energy assets will continue to generate stable and sustainable returns. This investment in EDC marks our first infrastructure commitment to the Philippines and we look forward to growing the company with our partners in this vibrant energy market."