Manila Electric Interested in San Miguel Power Assets

Article excerpt

Manila Electric Co. said it's interested in buying some of San Miguel Corp.'s power plants, to help the electricity retailer's expansion into power generation.

"If San Miguel is prepared to sell, we're prepared to take a look at it," Manila Electric Chairman Manuel Pangilinan said in an interview.

Manila Electric, also known as Meralco, is looking to return to generation after a four-decade hiatus, with plans to supply as much as 30 percent of demand on the Philippines' main island of Luzon. San Miguel, a shareholder of Meralco, wants to raise about $4 billion by selling power assets to help fund its expansion into industries and infrastructure, President Ramon Ang said in an interview on July 12.

Meralco is particularly interested in San Miguel's 1,200- megawatt coal-fired Sual power plant and its 345-megawatt San Roque hydroelectric plant, said Pangilinan. Both are in Luzon where the company is based. Meralco serves a quarter of the Philippines' population in an area that accounts for half of gross domestic product.

San Miguel's Ang didn't respond to mobile-phone messages seeking comment.

Meralco shares rose 2 percent to 281.40 pesos, its biggest gain since July 25. San Miguel gained 2.7 percent to 84.35 pesos, after falling in the past five sessions. The benchmark Philippine stock index was unchanged at 6,420.79.

San Miguel last month raised $400 million (P17.37 billion) by selling 54.3 million Meralco shares, leaving the company with a 27 percent stake in the power retailer. A fifth of the shares were purchased by Beacon Electric Asset Holdings Inc., the utility's major shareholder and also controlled by Pangilinan. …