MANILA, Philippines -- The recent purchase agreement between Metro Pacific Investments Corp. and the Lopez family in Manila Electric Co. has built in provisions that guard against the future buyout by a hostile party of the clan's remaining 6.7 percent stake in the power retailer.

Aside from the usual right of first refusal and tag-along rights in respect of the Meralco shares, the amended agreement barred the Lopezes' First Philippine Holdings Corp. from selling, transferring or alienating any of its remaining Meralco shares for a period of three years, the MPIC said in a disclosure to the Philippine Stock Exchange.

FPH, however, may sell the Meralco shares to a third party for as long as the shares will not exceed: a total of five million shares during the period January 1 to June 30, 2011; five million from July 1 to Dec. 31, 2011; and 20 million during the period July 1, 2012 until the end of the three-year standstill period.

The shares proposed to be sold shall still be subject to the right of first refusal by either MPIC or affiliate Pilipino Telephone Corp.

For as long as FPH's interest in Meralco does not fall below 5 percent of total stock, the group led by Manuel V. Pangilinan will vote with the Lopezes as a block. One seat out of the 11-member Meralco board will still be earmarked for the Lopezes.

"MVP (Manuel V. Pangilinan) struck a good deal with FPH even without buying the whole stake," said a foreign fund manager.

Pangilinan's group can exercise its right of first refusal on the shares between 30 days and 90 days.

But under the same agreement, any subject shares that may be acquired by MPIC from FPH shall not be covered by standstill restrictions.

"First Holdings, Piltel and MPIC, as shareholders, will vote their shares in Meralco together as contemplated under the investment and cooperation agreement,"the disclosure said.

Pangilinan's group recently moved to defend its interest as the single biggest voting block in Meralco by matching a generous P300-per-share buyout offer made by the eldest son of tycoon Henry Sy to the Lopez family.

But the deal was structured in the form of a loan and a one-year call option, which analysts said was a legal way of avoiding a costly tender offer.

This deal will jack up the stake of Pangilinan's group to 41.4 percent from the current 34.7 percent if and when the call option is exercised, bringing the group closer to getting majority control of the power retailer. The Pangilinan-Lopez as a single block already controls 48.1 percent of Meralco.

The Pangilinan group's corporate rival San Miguel Corp. led by chairman Eduardo Cojuangco and president Ramon S. Ang, however, remains as an influential voting block in Meralco with a 27 percent stake.

In addition, its ally Global 5000 Investments Inc. led by former Trade Secretary Roberto V. Ongpin, businessman Inigo Zobel and condiments king Joselito Campos has voting rights equivalent to around 7-10 percent.

Meralco shares closed Tuesday at P210 per share, rebounding by 6.6 percent, on news that the state-owned Government Service Insurance System which is a minority investor in the company might seek legal remedy to force Pangilinan's group to make a tender offer to other minority shareholders.