KKR hikes ownership in First Gen with P8.68-B investment

MANILA, Philippines — US-based private equity firm Kohlberg Kravis Roberts & Co. (KKR) is investing P8.68 billion to raise its stake in First Gen Corp. — the listed power producer owned by the Lopez family — as part of its Asia Pacific strategy.

In a statement on Wednesday, KKR said Philippines Clean Energy Holding Inc., a subsidiary, intends to buy all 262.9 million common shares that were tendered by shareholders of First Gen at a price of P33 each.

KKR is an existing shareholder of First Gen after acquiring about 11.9% stake in the company in January last year. Once the transaction is completed, KKR will increase its ownership to approximately 19.9%.

The global investment firm will acquire the additional shares in First Gen through a block sale on October 8.

“This investment marks the latest milestone for KKR in the Philippines, and deepens our commitment to the market,” Michael de Guzman, managing director on KKR’s infrastructure team, said.

First Gen is a subsidiary of First Philippine Holdings Corp. and has 3,495 megawatts of capacity in its portfolio. Power produced by the company from its renewable energy and indigenous fuel sources accounts for 19% of the country’s gross power generation.

Casting a wider net over Southeast Asia is a key strategy of KKR Asia’s infrastructure segment. It is the same firm that invested in Metro Pacific Investments’ hospital unit and gave a $167-million funding to Voyager Innovations, which owns PayMaya.

KKR also has investments in telecom tower builder Pinnacle Towers.

On Wednesday, shares in First Gen lost 2.62% to close mid-week trading at P31.65 each.