Indonesian billionaire Prajogo Pangestu's Barito Renewables Energy made an unsolicited US$5 billion bid for Energy Development Corporation (EDC), the Philippines' largest geothermal producer, First Gen Corporation confirmed to the Philippine Stock Exchange on Wednesday, July 15. The indicative, non-binding offer arrives as the Strait of Hormuz remains closed following the US-Israel air war against Iran that began February 28, pushing oil prices higher and the peso to record lows near P61.70 per dollar. The bid targets a company with 1,302.78 megawatts of geothermal capacity across 16 power stations, valued at over P300 billion at current exchange rates, and comes amid an ongoing dispute within the Lopez family over control of their energy empire. First Gen stated no discussions have occurred between the parties, no agreements have been signed, and no financial advisers have been hired for any transaction.
First Gen Holds 65% Voting Control But Only 45.8% Economic Interest in EDC
First Gen Corporation controls EDC through a 65% voting interest, primarily held via Red Vulcan Holdings, the acquisition vehicle from the 2007 privatization. However, First Gen's actual economic interest in EDC stands at 45.8% according to its April information statement filed with the exchange. The controlling bloc maintains its position through voting preferred shares that carry ballots but limited economic weight. Red Vulcan is a special-purpose company wholly owned by First Gen through Prime Terracota holding company, created specifically to bid for the government's EDC stake in 2007.
PREHC Consortium Controls Majority Economic Value Despite Minority Voting Rights
Philippines Renewable Energy Holdings Corporation (PREHC), a vehicle of Australia's Macquarie and Singapore's sovereign wealth fund GIC, holds 34.9% of EDC's voting rights but controls roughly 54% of the company's economic value. The consortium entered through a US$1.3 billion tender offer in 2017. EDC has been delisted from the stock exchange since 2018, narrowing its ownership to these two blocs. At Barito's US$5 billion equity value and P61.70 exchange rate, PREHC's economic share would be worth approximately P170 billion, while First Gen's 45.8% would convert to roughly P140 billion.
Barito's Offer Would Combine Southeast Asia's Two Largest Geothermal Companies
The acquisition would more than double Barito Renewables' geothermal capacity in a single transaction. Barito's subsidiary Star Energy Geothermal currently operates 886 megawatts across three fields in Indonesia's West Java, making it Indonesia's largest geothermal producer. Prajogo Pangestu, who controls Barito Renewables, carries a Forbes-estimated net worth of approximately US$15.4 billion. He built his empire from timber into petrochemicals and energy, and has been expanding across the region, including Indonesian wind ventures with the Ayala-led ACEN and refinery and fuel retail assets in Singapore.
EDC Operates 1,302.78 Megawatts Across 16 Geothermal Stations
EDC's geothermal portfolio includes the 637.2-megawatt Tongonan complex above Ormoc and Kananga in Leyte, now slated for expansion to 967.2 megawatts; the Southern Negros field above Dumaguete and Valencia with over 222.5 megawatts capacity undergoing P25 billion renewal; the 197.27-megawatt Bacon-Manito complex straddling Sorsogon and Albay; and the roughly 106-megawatt Mt. Apo complex in Kidapawan, North Cotabato. The company also operates approximately 300 megawatts of wind, hydro, and solar capacity, led by the Burgos wind farm in Ilocos Norte and the Pantabangan-Masiway hydro complex in Nueva Ecija. EDC accounts for roughly 6 of every 10 installed geothermal megawatts in the Philippines, which ranks third globally in geothermal power after the United States and Indonesia.
Philippine Stock Exchange Sanctioned First Gen on July 9 for Disclosure Violations
On July 9, the Philippine Stock Exchange published penalties against First Gen for disclosure violations tied to Prime Infrastructure transactions. The sanctions came after months of complaints from the majority bloc at Lopez Inc. accusing Federico "Piki" Lopez of withholding timely information about gas and hydro deals. Six days later on July 15, the Barito offer became public through a Bloomberg report before First Gen's confirmation to the exchange. In November 2025, First Gen sold 60% of its natural gas business to Enrique Razon Jr.'s Prime Infrastructure.
EDC Founded in 1976 as State Response to Oil Crisis
The Philippine government created the Philippine National Oil Company (PNOC) in November 1973 after the Arab OPEC embargo quadrupled crude prices and caused rationing and brownouts. In March 1976, the government established Energy Development Corporation under PNOC as the state's arm for developing the country's volcanic geothermal resources. By 1983, EDC had commissioned its first plants at Tongonan and Palinpinon. In November 2007, Red Vulcan acquired the government's 60% stake in PNOC-EDC for P58.5 billion, valuing the entire company at approximately P100 billion at that time.
Strait of Hormuz Closure Impacts Philippine Energy Security and Currency
Since the United States and Israel launched an air war against Iran on February 28, Iran has declared the Strait of Hormuz closed. The waterway carries approximately one-fifth of the world's seaborne oil and liquefied natural gas in peacetime. The International Energy Agency has called the current situation the largest supply disruption in the history of the global oil market. For the Philippines, which imports nearly all of its oil, the consequences have appeared in fuel prices and the exchange rate, with the peso falling to record lows near P61.70 per dollar as of July 15.
FAQ
What is the ownership structure of Energy Development Corporation?
First Gen Corporation holds 65% of EDC's voting rights but only 45.8% of its economic interest, primarily through Red Vulcan Holdings. Philippines Renewable Energy Holdings Corporation (PREHC), a consortium of Macquarie and GIC, holds 34.9% of voting rights but controls approximately 54% of EDC's economic value. EDC has been delisted from the stock exchange since 2018.
How much would Barito Renewables' offer be worth in pesos?
At the exchange rate of P61.70 per US dollar as of July 15, Barito's US$5 billion equity value offer converts to over P300 billion. First Gen's 45.8% economic share would be worth approximately P140 billion, while PREHC's roughly 54% economic share would be worth approximately P170 billion at this valuation.
What geothermal capacity would Barito acquire through EDC?
EDC operates 1,302.78 megawatts of installed geothermal capacity across 16 power stations, plus approximately 300 megawatts of wind, hydro, and solar capacity. The acquisition would more than double Barito's current geothermal capacity, as its subsidiary Star Energy Geothermal operates 886 megawatts in Indonesia's West Java.
