Manila Electric Co. (Meralco), the country’s largest power distributor, is mulling over a plan to jointly build a power plant with the Gokongwei-led JG Summit Holdings.
Meralco Chairman Manuel Pangilinan said he is in talks with JG Summit about expanding JG Summit Petrochemical Corp., the petrochemical business of the Gokongwei family.
Should the power plant deal proceed, Pangilinan will only be taking its partnership with the Gokongwei family into a step further. The Gokongwei family, through JG Summit, has a significant stake in the Pangilinan-led Philippine Long Distance Telephone Co.
“We spoke about expanding Petrochem part. We’re thinking of building power plant. We could revive that, we could co-invest with them on power plant,” Pangilinan said, specifying that the joint venture aims to contribute in sustaining the adequate power supply for Luzon.
Pangilinan said that the talks is still a “little premature” and no transactions between the parties have been closed yet.
Considered the newest party involved in San Miguel Corp.’s (SMC) divestment from Meralco, JG Summit announced earlier this month that it will purchase the entire remaining stake of SMC in the country’s largest power distributor for P72 billion.
Pangilinan said he have already met with JG Summit to give the company general view of Meralco, adding that the two firms could close the shares acquisition deal earlier, making way for JG Summit to own three board seats in the power distributor.
JG Summit on October 1 told the Philippine Stock Exchange (PSE) that it has already agreed to purchase the entire stake of SMC in Meralco, which amounts to about 27 percent of the company’s total outstanding shares, for about P72 billion.
“JG Summit intends to finance the acquisition with a combination of debt and equity capital,” the conglomerate further said in its disclosure to the PSE.