Recent deals involving foreign investors taking sizeable stakes in two Philippine firms should be credited to the Duterte administration and its socio-economic reform agenda, the Finance department claimed on Thursday.
Specifically, the department cited Japan Tobacco International’s plan to take over cigarette maker Mighty Corp for P45 billion and a consortium of investment fund managers’ offer to buy up to 31.7 percent of renewable power producer Energy Development Corp. for P64.5 billion.
“The credit goes to President [Rodrigo] Duterte who inspires trust and confidence in the Philippines,” Finance Secretary Carlos Dominguez 3rd was quoted as saying in a statement.
Earlier this month, Lopez-led First Gen Corp. announced that the Philippines Renewable Energy Holdings Corp. (PREHC) consortium was offering to buy up to 8.9 billion common shares in EDC, with First Gen itself selling a 10.6 percent stake.
PREHC was formed by Macquarie Infrastructure Management (Asia) Pty Ltd, a unit of Australia’s Macquarie Group, and Arran Investments Pte Ltd., a unit of Singapore’s sovereign wealth fund GIC Pte Ltd.
The deal is expected to lead to the delisting of EDC, which will remain under the Lopezes’ control.
Ownership of tobacco firm Mighty, meanwhile, will change hands as the company – the Philippines’ second largest cigarette maker – was snapped up by JTI in the wake of a multibillion-peso tax evasion case.
The government earlier this year filed three criminal complaints against Mighty, claiming that the firm used fake tax stamps to avoid paying excise taxes. In July, the company offered P25 billion to settle the matter, to be funded by the sale of its assets to the local unit of JTI.
Mighty, through JTI, already remitted P3.44 billion last July 20, representing the initial tranche of its settlement offer.
The remainder will be paid once antitrust regulators clear the sale to JTI.
An additional P5 billion will be earned the government from value-added taxes on the JTI-Mighty deal, Dominguez said.