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Philippines: San Miguel to give up control over power units
Diversifying San Miguel Corp. is ceding a controlling 60-percent stake in two key power-generation subsidiaries operating the San Roque hydroelectric plant, the coal-fired Sual power plant and the Ilijan gas plant in favor of local fund Global 5000 Investments Inc, reported the Philippine Daily Inquirer.
Global 5000, which first grabbed the limelight in late 2008 when it bought into Manila Electric Co. as a voting ally of San Miguel, is led by former Trade Minister Roberto Ongpin and businessmen Iñigo Zobel and Joselito Campos, the same group that controls Top Frontier Holdings Inc., which now has a 38.63-percent ownership and 89.5-percent voting rights in San Miguel.
Based on San Miguel’s recent annual filing with the Philippine Stock Exchange, the conglomerate agreed to let Global 5000 come in as a 60-percent stockholder of Strategic Power Development Corp., the independent power producer (IPP) administrator of the 345-megawatt San Roque multi-purpose hydroelectric power plant in Barangay San Roque, San Miguel, Pangasinan.
The same filing disclosed that Global 5000 would take a 60-percent stake in San Miguel Energy Corp. (SMEC), the IPP administrator for the contracted capacity of the 1,000-MW coal-fired Sual power plant.
SMEC also recently bagged the right to manage and operate the 1,200-megawatt Ilijan gas plant when it submitted last April 16 the highest bid of $870 million for the IPP contract. SMEC also acquired last January the entire outstanding capital stock of Daguma Agro Minerals Inc., a coal mining company with a 2,000-hectare coal property located in Lake Sebu, South Cotabato.
SMEC was the winning buyer of the 620-MW Limay combined-cycle power plant that was privatised by the government last year. However, SMEC had sold the Limay power plant to a 100-percent-owned San Miguel subsidiary, Panasia Energy Holdings Inc., which started operations of the plant last Feb. 16.
The San Miguel documents showed that Global 5000 would end up with a 60-percent stake in the two companies by subscribing to new shares out of the authorized capital stock and likewise participating in a further increase in their authorized capital stock.
The planned capital increase, which will dilute San Miguel’s interest in the subsidiaries, has been approved by the boards of SPDC and SMEC.
Following its diversification into other businesses, San Miguel earlier signed deals to acquire a 27-percent stake in Meralco and an option to acquire a 50.1-percent stake in Petron Corp. Through its subsidiaries, it has also acquired a 32.7-percent stake in Liberty Telecoms Holdings Inc., a 35-percent stake in Private Infra Development Corp., which will undertake the construction of the Tarlac-Pangasinan-La Union Tollway, and a 31-percent stake in Bank of Commerce.