KKR Exits Power Producer First Gen in $411 Mn Sale After Expansion Bid Fails
The private equity firm sold its entire 19.9% holding to Angsana Finance weeks after First Philippine Holdings rejected a proposal that could have nearly doubled KKR’s stake and led to First Gen’s delisting.
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New York-based private equity giant KKR has exited Philippine power producer First Gen Corporation, selling its entire 19.9% stake for PHP25.77 Bn ($410.5 Mn), just weeks after the company’s controlling shareholder rejected the PE’s attempt to substantially increase its holding.
Valorous Asia Holdings, an investment vehicle controlled by KKR funds, sold about 715.9 Mn First Gen shares to Angsana Finance at PHP36 apiece on September 10, according to regulatory filings. The transaction ends a six-year investment that began when KKR first bought into the Philippine energy company in 2020.
The exit marks a sharp change in direction. In August, KKR had proposed buying another 8.43% of First Gen from parent First Philippine Holdings Corporation (FPH) and launching a tender offer for the company’s 11.67% public float. Had all those shares been acquired, KKR’s economic interest could have risen from 19.9% to about 40%, while the tender was intended to support a voluntary delisting from the Philippine Stock Exchange.
The proposal offered PHP35 per share for the additional stake and public float. FPH rejected it on August 17, saying after deliberation that KKR’s proposal did not represent First Gen’s “true value”. Less than a month later, KKR sold the stake it already owned for PHP36 a share, about 3% above the price attached to the rejected proposal.
The distinction matters. KKR had been seeking to deploy more capital into First Gen and potentially double its ownership. Instead, the firm has now monetised the entire position, transferring a near-20% block to a new investor.
Angsana Finance is incorporated in the Cayman Islands and became a 19.9% owner of First Gen following the transaction, according to the Philippine Stock Exchange filing. Legal Entity Identifier records identify Gateway Holdings as both its direct and ultimate parent. Public corporate filings also link Angsana and Gateway Holdings through shared directorships with Gateway Partners, an emerging-markets investment manager based in Singapore and Dubai.
Gateway Partners focusses on private equity and private credit across Southeast Asia, South Asia, the Middle East and Africa. Its Singapore fund-management arm is regulated by the Monetary Authority of Singapore (MAS), while the firm says it has deployed about $1.9 Bn across more than 30 countries. Its existing Philippine investments include digital lender UNO Bank and land-management technology business TerraCIS Digital/Land Registration Systems.
KKR’s relationship with First Gen dates to July 2020, when Valorous acquired about 427 Mn shares for PHP9.6 Bn, giving it an economic interest of 11.9%, which had grown to about 12.59% by September 2021. A KKR-controlled vehicle bought another 262.9 Mn shares for PHP8.7 Bn through a tender offer in October 2021, bringing KKR’s combined holding of First Gen to about 19.9% after the second tender offer that month.
The investment spanned a period of significant change at First Gen. Last year, the Lopez Group sold a 60% interest in its natural-gas business and transferred operating control of those assets, while retaining a 40% economic interest. It now operates 31 renewable power projects and installations with 1,764.2 MW of installed capacity across geothermal, hydro, wind and solar.
Geothermal remains the largest part of that portfolio, accounting for about 1,302.8 MW of capacity, followed by hydro at 299.4 MW and wind at 150 MW. According to First Gen, it intends to use the proceeds from the disposal of its majority interest in the gas assets to redirect capital towards renewable generation.
For KKR, however, the September transaction closes that chapter entirely. What began in August as an attempt to deepen a six-year investment and potentially remove First Gen from the stock exchange has ended instead with a complete exit, with Angsana taking over one of the company’s largest blocks of shares while FPH remains firmly in control.
New York-based private equity giant KKR has exited Philippine power producer First Gen Corporation, selling its entire 19.9% stake for PHP25.77 Bn ($410.5 Mn), just weeks after the company’s controlling shareholder rejected the PE’s attempt to substantially increase its holding.
Valorous Asia Holdings, an investment vehicle controlled by KKR funds, sold about 715.9 Mn First Gen shares to Angsana Finance at PHP36 apiece on September 10, according to regulatory filings. The transaction ends a six-year investment that began when KKR first bought into the Philippine energy company in 2020.
The exit marks a sharp change in direction. In August, KKR had proposed buying another 8.43% of First Gen from parent First Philippine Holdings Corporation (FPH) and launching a tender offer for the company’s 11.67% public float. Had all those shares been acquired, KKR’s economic interest could have risen from 19.9% to about 40%, while the tender was intended to support a voluntary delisting from the Philippine Stock Exchange.
