Pangilinan-led Metro Pacific Investments Corp. yesterday become a significant minority shareholder in Manila Electric Co. (Meralco), after acquiring a 15% stake from sister companies.

Together with a 20% Meralco stake acquired by the Philippine Long Distance Telephone (PLDT) Co. in March, the Pangilinan bloc now controls 35% of the country’s largest power distributor.

A total of 148 million Meralco shares were crossed through the stock market yesterday. This was bought by Metro Pacific from the PLDT Beneficial Trust Fund and Hong Kong-based New Gallant Ltd. and Crogan Ltd.

The shares, worth over P19 billion, are equivalent to 13.25% of Meralco’s outstanding shares. On top of this, Metro Pacific said it had acquired another 1.7% stake in the open market.

"The acquisition of a strategic block of Meralco shares affirms our efforts to position Metro Pacific as one of the country’s leading infrastructure companies that will complement our existing investment in the road, water and hospital sectors," Metro Pacific president Jose Ma. K. Lim said.

Metro Pacific chairman Manuel V. Pangilinan said the company plans to acquire more Meralco shares in the future.

"[I]f suitable opportunities arise, Metro Pacific is open to acquiring further shares of Meralco and position itself as a strategic shareholder of the power distributor with appropriate board and management participation," Mr. Pangilinan said.

Metro Pacific is the Philippine unit of Hong Kong’s First Pacific Co. Ltd., which partly owns PLDT.

In March, PLDT unit Pilipino Telephone Corp. bought a 20% stake in Meralco from the Lopezes in a defensive move to protect its telecommunication business. Late last year, San Miguel Corp. bought a 27% take from the government.

The two groups wanted to use Meralco for separate plans to venture into broadband Internet using power lines.

The Lopez group, which still has a 13.4% stake through First Philippine Holdings, Inc., has allied with the Pangilinan bloc to retain management.

The Pangilinan group and the San Miguel group have four representatives each in Meralco’s 11-man board, while First Philippine Holdings is represented by Manuel M. Lopez, who sits as chairman. The remaining two seats are held by independent directors, ex-chief justice Artemio V. Panganiban and Vicente L. Panlilio.

An analyst said the Meralco acquisition would augur well for Metro Pacific since the power distribution business is considered a defensive sector unaffected by the ups and downs of the economy.

Metro Pacific’s portfolio includes Maynilad Water Services, Inc., Metro Pacific Tollways Corp. which operates the North Luzon Expressway, and several hospitals.

Its shares climbed by P0.05 to close at P3.30 apiece yesterday.

Mediaquest Holdings, Inc., a unit of the PLDT Beneficial Trust Fund, has a minority stake in BusinessWorld.

abs-cbnNEWS.com is the online news department of ABS-CBN Interactive Inc., a subsidiary of ABS-CBN Broadcasting Corp. ABS-CBN and Meralco are both part of the Lopez Group of Companies.