Meralco firms up Nigerian investment


MANILA Electric Co. (Meralco), the country’s largest power distribution utility, is expanding its presence in Nigeria through a technical partnership with a Nigerian distribution utility.

“On Nigeria, we have a technical partnership with Ibadan Electricity Distribution Company,” Meralco President Oscar Reyes said in a media briefing on Tuesday.

“Following our performance and the feedback other utilities have gotten, we had been invited by Port Harcourt Development Distribution Co. to provide the same type of technical partnership and service, basically advisory and support services, to Port Harcourt,” Reyes explained.

“In fact they wanted a more extensive arrangement. However, this requires that they get necessary approvals from regulatory authorities. Ibadan has been positive to Meralco and I think we’re looking at more or less the same positive contribution from Port Harcourt,” he added.

Reyes said that Meralco was given an option for equity but the company has limited itself to a technical partnership for now.

“In the same way, similar with Ibadan Electric, they have given us the option for equity but what we have done so far is limit ourselves to a technical partnership because we want to see performance in certain commitments by the regulators such as tariff reform, power supply and security,” he said.

Meanwhile, Meralco’s wholly owned subsidiary CIS Bayad Center Inc., a leader in the outsourced payment collection industry, is taking in a Japanese investor,

Densan System Co. Ltd. (DSK), which provides integrated data-processing services in Japan.
“We have a new investor. They have invested already. They’ve come in, they have 5 percent share in Bayad Center,” Reyes said.

“We have a strong partner with fairly solid links with Japanese convenience stores who are not only present in the Philippines but also in the region,” he said.

The partnership will help build presence in other countries, he said, as Densan provides the billing and payment platform to Japanese convenience stores.

“So we are looking forward for the opportunity of this entry into Bayad Center, being a vehicle for us to jointly look at opportunities in other countries in the region, Indonesia and other countries,” he said.

Reyes said that the partnership will make it easier for customers to tap the different convenience stores like FamilyMart, 7-Eleven, MiniStop “because their platform is already embedded and it is easy to tap them for additional Bayad Center outlets.”

The Meralco subsidiary is working to establish its presence outside the Philippines by studying the market, and is keen to branch out in Vietnam, Malaysia, and Thailand, with special emphasis in Indonesia.

“We have to look at other countries like Vietnam, Malaysia, Thailand, but in Indonesia it has biggest market,” Reyes said.

The 5 percent investment of Densan in Bayad Center brought in roughly a little under P230 million, he said.
“They have 5 percent and they wanted more. We said let’s start with 5 percent. No option (to increase) but we can still talk. I think we would like to see the value they can create,” Reyes added.


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