Citicore parent sells 1.7% block of CREC to pump its float

Citicore Renewable Energy [CREC 3.52 ?0.8%; 14% avgVol] [link] disclosed that its parent company, Citicore Power Inc (CPI), sold 153,741,000 CREC shares in a block sale. According to CREC, the block sale was one of CPI’s conditions precedent to closing the deal with Indonesia’s PT Pertamina Power (“Pertamina”), where Pertamina is set to take a 20% stake in CREC. Since the shares sold to Pertamina would count as non-public shares (due to Pertamina’s degree of control through its board seats), CREC’s public float would have fallen below the PSE’s minimum 20% if CPI had not completed this sale (and the other(s) to come) prior to the close of the Pertamina deal.

MB BOTTOM-LINE:  We didn’t get any details on the price that CPI got for the block sale shares, but the important thing here is that this sale is less than half of the shares that CPI has committed to sell to clear the way for the Pertamina deal. They originally said that they’d sell 346.34 million shares, so after this sale, that still leaves 192.5 million CREC shares that CPI needs to sell. The stock is up 8% over the past month and up 30% from its IPO, but it’s faded over the past week and the market’s crappy vibes can’t be helping matters that much. I don’t have any fears that CPI will fail to competently manage its public float, say like SP New Energy [SPNEC 1.15 ?0.9%; 101% avgVol] did back when it was suspended (and nearly delisted) when the SEC surprised the management team with quick approval of its share swap transaction. There’s no SEC randomizer here. CPI and Pertamina negotiated the terms and the timelines are known. They’ll make it to the finish line.