Repower Energy Development Corporation [REDC] [prospectus link] received SEC approval to conduct an IPO to sell up to 230 million shares at P5.00/share, for a total transaction value of P1.15 billion.
The preliminary deal is 200 million primary shares and 30 million secondary shares as part of REDC’s over-allotment option, with pricing scheduled for May 30, an offer period scheduled for June 5 through June 14, and a listing on June 23.
REDC plans to put 74% of the deal proceeds toward partially funding the equity portion of 19.5 MW of current hydropower projects, with 16% reserved for the funding or acquisition of additional renewable energy projects, and 10% reserved for working capital.
The deal would give REDC a P3.25 billion post-transaction marketcap.
The company is the hydropower subsidiary of Pure Energy Holdings Corp (PEHC), which is headed by Dexter Tiu. REDC had 2022 revenues of P382 million (up from P136 million in 2020), and a 2022 net income of P168 million (up from P18 million in 2020).
China Bank Capital is the sole issue manager, underwriter, and bookrunner on the deal.
MB BOTTOM-LINE
I’m a fanboy of run-of-river hydro (I used to work in the industry back in a previous life, and the physics are fascinating to me) and I’m a fan of renewable energy development and of IPOs in general.
This isn’t a massive IPO by any means, but this is the kind of listing that the SEC and PSE were hoping to attract when it relaxed the listing rules and embarked on a multi-year marketing push to educate SMEs about the potential benefits of raising money through the markets.
Speaking of REDC specifically, I like that the deal is so primary-heavy and that the company is putting the vast majority of the proceeds toward project development.
I also like that they’ve got the chance for a particularly fun ticker symbol like REPOW, RPOWR, or HYDRO, so I hope they step away from the boring “initialism of the holding company’s legal name” strategy that companies like Figaro and Haus Talk used while squandering their obvious ticker potential.
I'm going to cover this one more in-depth once the deal is approved by the PSE.
--