Listed renewable energy firm Citicore Renewable Energy Corp. (CREC) is planning to merge six of its subsidiaries to simplify its corporate structure and boost operational efficiency.
The company informed the stock exchange report on Monday that the board approved the proposed consolidation, covering Citicore Solar Holdings, Inc., Sikat Solar Holdco, Inc., Citicore Solar Tarlac 1, Inc., Citicore Solar Tarlac 2, Inc., Citicore Solar South Cotabato, Inc., and Citicore Solar Bulacan, Inc., with CREC as the surviving entity.
The seven-way merger will now go to shareholders for approval at a special meeting.
“It is deemed advisable to merge the seven companies in order to achieve greater efficiency and economy in management and operations,” the company said. The firm explained that the subsidiaries “own, hold, and manage various assets for the same ultimate beneficial owners and are part of one group.”
Under the plan, CREC can issue new treasury shares in exchange for the shares it will receive from the merged units. The final number of shares is yet to be determined and may still change.
Once completed, all assets, rights, and liabilities of the six subsidiaries will transfer to CREC. The company said the merger is expected to be “value-accretive to the shareholders of CREC.”
Regulatory approval is still required from the Securities and Exchange Commission, while the Philippine Competition Commission will confirm whether the deal falls outside its coverage.
The company said the timetable for implementation, including the effective date, will depend on these approvals.
CREC, a pure renewable energy developer and operator of solar, run-of-river hydro, and off-shore wind energy platforms, has over 5 gigawatts of project pipelines in varying stages of development.