‘First Gen shares to get boost from P75 billion Prime Infrastructure deal’

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February 16, 2026 | 12:00am

MANILA, Philippines — The P75-billion hydropower deal between tycoons Enrique Razon Jr. and Federico Lopez not only fortifies their alliance but could also raise the water level on First Gen Corp.’s parched shares, analysts said.

The Lopez family’s energy arm recently disclosed plans to acquire a 40-percent stake in Razon-owned Prime Infrastructure Capital Inc.’s pumped storage hydropower (PSH) portfolio.

The deal, subject to regulatory approval, covers Prime Infra’s 600-megawatt Wawa PSH project in Rizal and the 1,400-MW Pakil PSH facility in Laguna, strengthening the tycoons’ growing energy pact.

“It’s a transformative deal for First Gen due to the scale of its bet on hydro,” investment banker Juan Paolo Colet of Chinabank Capital told The STAR, highlighting the “favorable economics” of PSH projects.

He noted that the completion of the 2,000-MW hydro projects would position First Gen as one of the sector’s leading players.

Over the long term, Colet expects First Gen’s “ever-closer and increasingly formidable energy alliance” with Prime Infra to propel its earnings and growth while giving a fresh lift to its stock.

“Hopefully, this eventually translates to better trading multiples for First Gen’s perennially undervalued stock,” he said.

First Gen’s share price closed 0.73 percent lower at P19.10 last Friday, a far cry from its initial offering price of P47 when it debuted on the Philippine Stock Exchange (PSE) in February 2006.

The company now has a market capitalization of roughly P69.2 billion, according to PSE data.

For RCBC economist Michael Ricafort, the multibillion-peso deal makes perfect sense for First Gen, given its expertise in renewable energy (RE) projects and its deep familiarity with the market.

Beyond expanding the company’s clean energy portfolio, the hydro deal could also generate “greater RE economies of scale,” Ricafort added.

Slated for completion by 2030, the Wawa and Pakil PSH projects were among the winners of the government’s third green energy auction program.

A PSH facility can function as an energy storage to complement generation from variable renewable sources while also injecting power into the grid to reinforce supply.

This latest deal between Razon and the Lopezes follows the completion of Prime Infra’s P50-billion takeover of First Gen’s gas business last year.