Meralco now in private hands; state firms sell remaining govt stake
Reuters | 12/03/2008 10:09 AM
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Philippine government financial institutions have agreed to jointly sell their holdings in utility firm Manila Electric Co. (Meralco) to a local investment fund for P9.9 billion ($200 million), government sources said late on Tuesday.
State-owned pension fund Social Security System (SSS), Land Bank of the Philippines (Landbank) and Development Bank of the Philippines (DBP) had signed a deal to sell about 110 million shares, equivalent to 10 percent, in the country's largest power distributor to Global 5,000 Investment Corp., the sources said.
Global 5,000 Investment has agreed to buy the state firms' shares at P90 apiece, the same price at which food and beverage conglomerate San Miguel Corp. bought its Meralco stake in October.
The sale price represented a 58 percent premium over Meralco's closing price of P57 on Tuesday.
Global 5,000 Investment would deliver payment over three years, the same term as San Miguel's earlier transaction.
San Miguel, Southeast Asia's biggest food and drinks group, bought 27 percent of Meralco from another state pension fund in a deal worth P26 billion (about $607 million).
San Miguel did not conduct due diligence before sealing the deal.
Other shareholders of Meralco include the Lopez business clan via their holding firm First Philippine Holdings Corp. with about 34 percent stake.
