Pangilinan signs P2.19B deal to buy Meralco stake from San Miguel unit
Manila Electric Co. chairman Manuel V. Pangilinan has signed an agreement to acquire 3.77 million Meralco shares worth P2.189 billion from San Miguel Global Power Holdings Corp. at P580.99 per share, raising his stake to about 0.34%. The deal follows a separate P12.4 billion block sale of 21.4 milli
Manuel V. Pangilinan, chairman and chief executive officer of Manila Electric Co. (Meralco), has signed an agreement to acquire P2.189 billion worth of Meralco shares from San Miguel Global Power Holdings Corp. (SMGP). SMGP said in a regulatory filing on Tuesday that it had signed a contract with Mr. Pangilinan for the sale of 3.77 million Meralco common shares at P580.99 apiece through a special block sale.
The shares represent about 0.33 per cent of Meralco’s outstanding shares. Upon completion of the transaction, Mr. Pangilinan’s stake in the company will increase to about 0.34 per cent. “The Corporation shall make the appropriate disclosures regarding the completion of the transaction in due course,” SMGP said.
The transaction follows Metro Pacific Investments Corp.’s (MPIC) agreement to acquire P12.4 billion worth of Meralco shares from SMGP. MPIC, which Mr. Pangilinan chairs, agreed to acquire 21.4 million Meralco common shares, equivalent to about 1.9 per cent of the power distributor, at the same price of P580.99 per share. Upon completion of that transaction, MPIC’s direct and indirect shareholding in Meralco will increase to about 49.4 per cent from 47.46 per cent.
The P580.99-per-share selling price is more than six times the P90 per share that SMGP paid when it acquired the Meralco stake from state-run Land Bank of the Philippines (LANDBANK). SMGP’s Meralco holdings stem from its P3.9-billion acquisition of a 3.8 per cent stake from LANDBANK last year, which ended a long-running legal dispute between the two parties.
“The shares being sold to MPIC come from a Meralco investment whose terms were set in December 2008, more than 17 years ago,” SMGP said in a statement on Wednesday. SMGP said the transaction carried fixed-term interest on the purchase price, which added to the investment’s overall cost. The transfer of the shares was also delayed by prolonged litigation, it added. The company said proceeds from the sale of its minority stake in Meralco would be used to fund existing investments and renewable energy projects.
SMGP is the power generation arm of San Miguel Corp., led by Ramon S. Ang. Its portfolio includes natural gas, coal, hydroelectric power, and battery energy storage systems. Meralco is the country’s largest private electric distribution utility, serving more than 8.2 million customers in Metro Manila and nearby provinces.
