The Securities and Exchange Commission is preparing guidelines that will encourage at least 150 power generators and distributors to comply with the required initial public offering.
SEC director for market securities and regulation department Graciano Felizmenio Jr. said in an interview at the sidelines of a recent forum the draft guidelines aim to facilitate and create a friendly environment for power-related firms to meet public listing requirement under Republic Act No. 9136 or the Electric Power Industry Reform Act.
“We are crafting this [SEC Power guidelines] to ensure the compliance of power and energy-related corporations with the listing requirement,” Felizmenio said.
Section 43 of the EPIRA and Rule 3 Section 4 of its implementing rules and regulations provide that the generation firms and distribution utilities are mandated “to offer or sell to the public a portion of not less than 15-percent of their common shares of stock.”
These firms are required to conduct stock offering five years from the effectively of the law or as early as 2006. However, several energy companies had delayed compliance with the IPO requirement, citing volatile market conditions.
The move to draft guidelines for listing of energy firms is patterned after the SEC’s previous guidelines that enabled various hospitals to raise up to P1 billion from direct public offering.
Felizmenio said 16 hospital firms were able to raise funds to partially finance the construction of their healthcare facilities.
The SEC also issued the guidelines process for agriculture-based companies to raise up to P500 million through share sale.
The initiative called SEC FARMs or Securing & Expanding Capitalform Farms and Agribusiness Related Modernization Schemes simplifies the listing of farm-based businesses by easing the requirements for external auditors and financial reporting.
Felizmenio said an agriculture company was already planning to raise funds through SEC FARMs to fund its poultry expansion.