First Gen ‘ripe’ for delisting amid KKR buyout offer

MANILA, Philippines — United States-based equity firm Kohlberg Kravis Roberts & Co. (KKR) made an offer to hike its stake in Lopez-led First Gen Corp., a move that should be “seriously” considered, as this could open doors for the energy giant to finally go private, an analyst said.

Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said on Thursday that First Philippine Holdings Corp. (FPH) should “seriously look into” the proposal and score a win-win deal for all shareholders, including the investing public.

READ: KKR buys 11.9% stake in First Gen

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“It’s also important that they are transparent about the process. An offer to take [First Gen] private, even if phrased as nonbinding, is material information that should be timely disclosed to the investing public,” Colet said.

“I’ve always said that [First Gen] is ripe for delisting, but any such exercise should be on terms beneficial to minority shareholders,” Colet added.

First Gen, a power generation firm with interest in gas facilities and a growing renewable energy portfolio, already floated in November that delisting was on the table following its P50-billion capital raised from the gas asset sale.

On Thursday, First Gen said that its parent, FPH, had received “a preliminary, non-binding” offer from KKR to acquire 8.43 percent of its shares in the former. At present, KKR holds a 19.9 percent stake in First Gen.

The proposal, dated July 10, also included KKR asking to seal a shareholders’ agreement with FPH.

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The global investment firm then plans to follow this with a voluntary tender offer for the entire public float of 11.67 percent of First Gen’s outstanding shares, paving the way for a voluntary delisting.

KKR noted that any deal giving investors “a direct or indirect change of control” would be forced to buy remaining shares from public stockholders. KKR also pegged the control premium “to be no less than 30 percent above their offer price, or about P46 per share.”

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“We have been informed that FPH has acknowledged the letter and is evaluating the proposal, especially in light of recent developments,” it said.

“To date, no agreements have been signed, no formal discussions have taken place, and no advisors or consultants have been appointed by First Gen,” the firm added.

In the first half of 2026, the company realized further gains from its geothermal energy investments, with its profit slightly up despite unloading a big chunk of its gas assets.

First Gen reported that its attributable recurring net income inched up to P8.7 billion from P8.6 billion a year ago.

Giving a major lift to its bottom line was Energy Development Corp., its unit tasked with strengthening First Gen’s foothold in the renewables space with more geothermal energy drilling activities and deployment of solar and wind power plants. INQ