Meralco buys Aboitiz unit for coal plant

ENJD
Business World

MANILA ELECTRIC Co. (Meralco) has moved to acquire a controlling stake in the Aboitiz Power Corp. unit that is building a 600-megawatt coal-fired plant in Zambales, disclosures filed with the local bourse showed.

RP Energy has the development rights over the coal-fired power plant planned to rise at the Subic Bay Freeport Zone. The planned acquisition falls in step with Meralco’s plans to start building a 1,500-megawatt (MW) power generation portfolio starting with a 600-MW base load plant and a 150-MW peaking plant by 2014.

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Fitch upgrades PLDT credit rating, may raise score further

Kathleen A. Martin
BusinessWorld

PHILIPPINE LONG Distance Telephone Co. (PLDT) has bagged another credit score upgrade, this time from Fitch Ratings which noted the improved climate in the country and possible gains from the telco’s acquisition of rival Digital Telecommunications Philippines, Inc. (Digitel).

The telecommunications giant’s long-term foreign currency issuer default ratings was raised to BBB- from BB+ with a stable outlook, Fitch said in a statement late on Friday.

Its credit score for debts in local currency was meanwhile raised to BBB+ from BBB, with the outlook for this rating on “positive watch.”

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EDC seals $175M loan facility with 7 foreign banks

Amy R. Remo
Philippine Daily Inquirer

MANILA, Philippines—The Energy Development Corp., the country’s largest geothermal energy producer, closed on Monday a six-year $175-million transferable syndicated term loan facility with seven foreign banking groups.
In a disclosure to the Philippine Stock Exchange, EDC said it would use the proceeds of the loan solely to refinance the company’s existing three-year $175-million transferable syndicated term facility maturing on June 2013.
The new loan, EDC said, effectively lengthened the remaining life of the existing facility to six years from two years and has substantially lowered interest costs.
The total firm underwritten commitment received from the seven banks was in excess of $600 million, three times more than the target amount.

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Inflation leaves analysts guessing rates

A. S. O. Alegado
BusinessWorld

AN INFLATION RATE in May that settled at the lower end of the central bank’s 4.5%-5.5% estimate for that month has left analysts guessing on next week’s rate-setting action.
Two banks said they expect the Bangko Sentral ng Pilipinas (BSP) to pause from its two rate hikes last March and May when it meets on June 16, while another believes the fact last month’s inflation rate was the highest in more than a year warrants continued monetary policy tightening.
The central bank has raised key rates twice, so far, this year, by 25 basis points (bps) in each occasion. The last such action, last May 5, raised these rates to 4.5% for overnight borrowing and to 6.5% for overnight lending.

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MetroPac firms up plans for Cebu expressway, Clark airport

NEIL JEROME C. MORALES
BusinessWorld

METRO PACIFIC Investments Corp. (MPIC) is firming up plans to build a toll road in Cebu and operate an airport in Clark with the projects’ feasibility studies expected to be completed by the second half of the year, officials said.
“Hopefully before the year ends, we can come up with the [results of a Cebu toll road] study,” Ramoncito S. Fernandez, president of MPIC unit Metro Pacific Tollways Corp., told BusinessWorld in a chance interview.

Metro Pacific Tollways has also reported plans to spend P25 billion for three big-ticket projects in the next four years. Segment 9 -- the four-lane, 2.42-kilometer (km.) stretch -- is eyed to connect NLEx to MacArthur Highway in Valenzuela City while the two-lane, 5.65-km.

Segment 10 is planned to run through MacArthur Highway to Radial Road R-10. These come on top of the 13.2-km. connector road that will link NLEx at C-3 Road to Skyway 1 along South Luzon Expressway in Makati.

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Aboitiz coal plant bags Davao council approval

JOEL B. ESCOVILLA
BusinessWorld

DAVAO CITY -- Aboitiz Power Corp.’s plans to build a 300-megawatt, coal-fired power plant here has been granted endorsement by nearly all local councilors, thus paving the way for permits from the mayor and other state agencies to be released.
The city council also approved a corollary resolution on first reading that amends the site’s zoning to accommodate the power plant.

All but one councilor endorsed the P25-billion project at Tuesday’s regular session.

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SMC pursues big foreign acquisition

JAMES A. LOYOLA
Manila Bulletin

MANILA, Philippines — Diversifying conglomerate San Miguel Corporation expects to seal an agreement for a major acquisition of an Asian company in July this year.

In an interview with reporters, SMC president Ramon S. Ang said the target company is one that SMC has been eyeing for a long time and they just could not let the opportunity pass even though the firm has shifted focus in its investment strategy from overseas expansion to domestic diversification.

While not naming the company or the industry its in, Ang said it is a company with ‘very big potential, very profitable and has a good network.”

“We can’t let this opportunity pass,” Ang said Tuesday at a briefing after San Miguel’s annual stockholders’ meeting.The target company in Asia is “very profitable and it has a big potential,” he said, declining to elaborate. San Miguel, a brewer for more than a century, plans to double its power- generation capacity in five to seven years, Chairman Eduardo Cojuangco told shareholders today.

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SMC diversification paying off, say investment houses

Doris C. Dumlao
Philippine Daily Inquirer

The 120-year-old San Miguel Corp. is starting to reap the fruits of its diversification into a conglomerate that no longer relies on its steady but maturing traditional businesses of food and beverage production, analysts said.
SMC, which is holding its annual stockholders’ meeting Tuesday, is now getting more coverage from foreign equity researchers for the first time since its entry into new businesses—power, oil refining, infrastructure, mining, banking and telecommunications—three years ago. Its shares have become more actively traded at the local stock exchange compared with the last two years when many investors were uncertain about its corporate strategy.
With its transformation, Goldman Sachs said in a May 31 report that SMC was now “well-placed” to benefit from the strong growth of its new businesses, citing its strong position in oil refining, power generation and electricity distribution (with its stake in Meralco).
“We believe SMC’s transformation is yet to be fully completed (oil refinery upgrade to be fully completed in end-2013 and material infrastructure contribution starts only in 2016), and see more potential upside from current levels,” Goldman Sachs added.

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Philex January-May output up 60% to P6.72B

MADELAINE FAYE D. CABRERA
Malaya Business Insight

Philex Mining Corp., the country’s largest and most profitable gold and copper producer, yesterday said production from January to May this year increased 60 percent to P6.72 billion from P4.21 billion in the same period last year.

Philex said shipments in the first five months of this year rose 44 percent to P4.72 billion from P3.28 billion.

Rogelio Laraya, Philex senior adviser, said the Padcal mine in May alone delivered 810,763 dry metric tons (DMT) of ore, resulting in 5,881 DMT of concentrates containing 62.19 grams of gold per DMT, 24.38 percent copper, and 59.48 grams of silver per DMT.

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Aboitiz subsidiary to power Batangas power distributor

BC/VS, GMA News

The Energy Regulatory Commission (ERC) on Monday approved a three-year power supply contract between AP Renewables Inc. and First Bay Power Corp.

AP Renewables, a unit of the Aboitiz Power Corp., will be sourcing the power for Firs Bay from the Tiwi Geothermal Power Plant in Albay and the Makban Geothermal Power Plants in Laguna and Batangas.

Since acquiring the power plants, AP Renewables has been the assignee of the National Power Corp. (Napocor) contracts which includes First Bay. Two years ago, First Bay asked the ERC to extend the transition supply contract from Oct. 25, 2009 to Jan. 25, 2010.

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BSP may raise key rates to head off inflation

Ronnel W. Domingo
Philippine Daily Inquirer

The Bangko Sentral ng Pilipinas may decide to raise its key policy rates by 25 basis points next week as inflation is expected to peak in the next few months, according to Standard Chartered Bank.
As a result, the BSP’s overnight borrowing rate may rise to 4.75 percent, and the lending rate to 6.75 percent.
Authorities are scheduled to meet on June 16 to decide on the monetary policy.
In a research note, Standard Chartered raised the gross domestic product (GDP) growth forecast for the Philippines this year to 5.7 percent from 5.4 percent in light of “more sustainable growth dynamics.”

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Manila’s ICTSI launches bid to buy Singapore’s Portek

G7Finance.com

MANILA, June 1 (Reuters) – The Philippines’ International Container Terminal Services Inc (ICTSI)on Wednesday launched a takeover bid for Singapore’s Portek International Ltd, offering to buy its shares at a 69 percent premium to market prices.

The Manila-based port operator offered S$1.20 for each Portek share, valuing the port operator at around S$180 million ($146 million). Portek shares had closed at S$0.71 on Tuesday.

ICTSI, with a market value of around $2 billion, said in a stock exchange disclosure its ICTSI Far East Pte Ltd unit made the conditional offer through financial adviser HSBC .

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Megawide bags P1.5B Belle casino project

Doris C. Dumlao
Inquirer.net

Newly listed Megawide Construction Corp. has bagged a P1.5-billion contract for a casino complex being developed along Manila Bay by leisure estate and gaming firm Belle Corp.
In a statement on Wednesday, Megawide said the new contract for the succeeding phases of Belle Grande Manila Bay complex includes construction of structural and civil works of two hotel towers, four condotels and an additional casino floor.

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Metro Pacific to raise capital stock to P30B

CMA/VS, GMA News

Metro Pacific Investments Corp. (MPIC), the local unit of Hong Kong-based First Pacific Co. Ltd., has received the nod from the Securities and Exchange Commission to raise its authorized capital stock.

In a disclosure to the Philippine Stock Exchange on Thursday, MPIC said its authorized capital stock will be raised to P30.05 billion from P24.24 billion.

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