SPC Power Corp. (SPC), formerly Salcon Power Corp., said it will appeal the decision of the Supreme Court (SC) nullifying the sale of a power plant in Cebu to the company through a bidding conducted by the state-run Power Sector Assets and Liabilities Management Corp. (Psalm).
In a disclosure to the Philippine Stock Exchange (PSE), SPC Power said it intends to file a motion for reconsideration on the SC ruling.
Psalm had earlier issued SPC a Notice of Award for the 153.1-megawatt (MW) Naga power plant after SPC exercised its “right to top” option in the third round of bidding for the plant, but this was later declared void by the Supreme Court.
In a 19-page decision, the high court nullified the notice of award of the Naga Power Plant in Cebu to SPC.
SPC Power clarified, however, that the SC decision has not yet been received by the company.
“However, on the assumption that the decision of the Supreme Court is what has been reported, SPC intends to file a motion for reconsideration thereof,” SPC Power said.
For its part, Therma Power Visayas Inc. (TPVI), a subsidiary of AboitizPower, welcomed the ruling of the Supreme Court.
“While we have not received the official notice regarding the Supreme Court’s decision, we are pleased with this development as this supports a transparent and fair bidding process that encourages open competition,” said Benjamin Cariaso Jr., TPVI Business Unit head.
Cariaso said they believe that TPVI won the bid.
“Had TPVI not participated, the government would have sold its asset at a much lower price,” he added.
Psalm conducted the first bidding for the Naga power plant in 2013. The first two rounds were declared failed bids as only one bidder, SPC, showed up.
TPVI joined the third round and won with a bid of P1.089 billion, higher than SPC’s bid of only P859 million.
SPC, however, exercised its right to top, and was issued a Notice of Award by Psalm despite some unanswered issues and a Supreme Court case questioning the validity of the right-to-top provision.
Psalm also maintained that the right to top provision does not violate any law.
It pointed out that the Department of Justice (DoJ) had affirmed the legality of the “right to top” the adjoining property within the Naga Power Plant Complex (NPPC) accorded to the owner of the Naga Land-Based Gas Turbine Power Plant in connection with the privatization of NPPC.
However, in a decision, the SC Third Division said SPC’s right to top under its land lease agreement (LLA) was void “for lack of valued interest or right to the object over which the right of first refusal is to be exercised.”
The SC pointed out that the property subject of the right of first refusal is outside of the leased premises covered by the LLA.