Government sells Meralco shares to GSIS
The Department of Finance said the government sold its shares in the country’s largest electricity distributor to the state-run pension fund for government workers.
Finance Undersecretary Crisanta S. Legazpi said revenues raised from the sale of the government’s stake in Manila Electric Co. (Meralco) last week was below target.
She said the sale of the 10 percent Meralco stake to the GSIS netted P8.9 billion. The finance department earlier was expecting to generate at least P11 billion from the sale of its Meralco shareholdings.
The government sold the assets, which included the 7.6 percent held by the Privatization and Management Office and a portion of that held by the Presidential Commission on Good Government, at P80.91 per share, higher than the market price of P71.5 during the period. AT the Philippine Stock Exchange, Meralco shares closed at P80 each on Thursday.
“The sale was done with another government entity, as a result of which, the total number of shares is still with the government. It’s not a privatization because the sale was made to another government entity,” Legazpi told reporters.
She saw no legal hurdles arising from the sale of the GSIS. “The sale was done with another government entity, because of that, it doesn’t have to be done through a bidding,” she added.
“If the GSIS wants to sell the assets to a private company, the transaction, however, should be coursed through the PSE because Meralco shares are listed,” the finnce official said.
“The process [in the PSE] is also transparent,” she said.
Meralco takes direct hand at Clark
Meralco recently gained a controlling stake in the company distributing electricity throughout the Clark Special Economic Zone in Pampanga.
In a disclosure to the PSE, Meralco said that it has acquired a 65 percent stake in Clark Electric Distribution Corp. (CEDC) from its unit Meralco Industrial Engineering Services Corp. (MIESCOR) through a dacion en pago or payment in kind.
The deal involves the transfer of MIESCOR’s 562,500 common shares in CEDC with par value of P100 per share to Meralco.
CEDC, a joint venture between Angeles Electric Corp. and MIESCOR, has been providing the sole electrical services in Clark since 1997 and serves more than 1,000 customrs, consisting of mostly large industrial companies.
Meralco officials said the transaction would allow the company as well as its subsidiary to focus on their core businesses.
MIESCOR is primarily involved in engineering, construction, and other services to clients in both domestic and international markets. - Chino S. Leyco with Euan Paulo C. Anonuevo, Manila Times Business, February 1.
Source: GSIS Layunin, Vol. 4 Issue 3, March 2008