MGEN Renewables-SPNEC merger eyed in Q4

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May 23, 2026 | 12:00am

MANILA, Philippines — The planned merger between MGEN Renewables and SP New Energy Corp. (SPNEC) is expected to be completed later this year, setting the stage for a re-initial public offering (IPO) in early 2027.

Emmanuel Rubio, president and CEO of Meralco PowerGen Corp. (MGEN), told The STAR that the valuation for MGEN Renewables and SPNEC has already been finalized, with both firms now preparing for the merger in the fourth quarter.

The transaction will consolidate the assets of the two companies, with SPNEC set to be renamed MGEN Renewable Energy Holdings Inc. (MGENR) as the surviving entity.

MGEN Renewables serves as the renewable energy (RE) arm of the Meralco Group, while SPNEC is behind the P200-billion MTerra Solar project straddling Nueva Ecija and Bulacan.

Rubio, however, said the planned asset infusion remains contingent on the completion and delivery of the full 850-megawatt capacity of MTerra Solar.

Once this milestone is achieved, MGENR could proceed with the re-IPO as early as the “first quarter of 2027,” he said.

“A single listed platform would sharpen investor focus on MGEN’s RE business and potentially improve valuation,” China Bank Capital managing director Juan Paolo Colet said when sought for insights.

Colet said the move is strategic for MGEN, especially as renewables gained fresh momentum amid the ongoing Middle East war that exposed the country’s heavy reliance on imported fuel.

MGEN, the power generation arm of utility giant Manila Electric Co. (Meralco), took over SPNEC in 2023 after acquiring a majority stake from Solar Philippines — the company founded by Batangas Rep. Leandro Leviste — through MGEN Renewables.

SPNEC filed in January for a corporate name change to MGENR, a move that fueled speculation that MGEN Renewables could be positioning for a backdoor listing, given the close alignment with SPNEC’s planned rebrand.

This gained further clarity in February when Meralco chairman Manuel V. Pangilinan hinted at a potential re-IPO as a way to secure fresh funds.

“The re-IPO could help them raise capital for future expansion,” COL Financial chief equity strategist April Lee-Tan said. “Most likely they want to take advantage of the favorable sentiment toward renewables right now while the price of fossil fuels is elevated.”

As of yesterday’s closing, SPNEC’s shares were valued at P1.61 each, giving the company a market capitalization of around P80.12 billion.

For Unicapital Inc. equity research analyst Peter Garnace, the infusion of MGEN’s operating RE assets to SPNEC would significantly expand its portfolio, improve income visibility and reduce project concentration risk.

“Following the merger, we see SPNEC, which will be renamed to MGENR, emerge as one of the most compelling proxies for the Philippines’ clean energy transition, supported by the Meralco Group’s scale, execution capabilities and expanding RE pipeline,” he said.

Beyond the growth and expansion benefits, Garnace added that the transaction could also result in dilution for existing shareholders, including Leviste, whose solar business was recently hit with a P24-billion government penalty over alleged nonperformance.

Leviste’s Solar Philippines still owns 16.3 percent of SPNEC, with the Meralco Group holding a 57.33-percent stake through MGEN Renewables.