MANILA, Philippines ? The Ayala Group has teamed up with the First Pacific Group of Hong Kong to bid for the government's 246-megawatt Angat Hydroelectric Power Plant in Norzagaray, Bulacan.

This intention to jointly bid for the power plant, which is set to be auctioned off in April, marks both group's first concrete attempt of breaking into the power generation business.

Ayala Corp. and First Pacific's local infrastructure arm Metro Pacific Investments Corp. (MPIC) separately disclosed to the Philippine Stock Exchange on Thursday that they had executed a letter-agreement confirming their interest in the bidding.

Ayala and MPIC have agreed to participate in the bidding through Michigan Power Inc., a subsidiary of Ayala that submitted a letter of interest to the state-owned Power Sector and Assets Liabilities Management Corp. (PSALM), which is in charge of privatizing power assets.

Michigan Power will be jointly owned by Ayala and MPIC, subject to allocation of required equity to a technical partner in accordance with the bidding procedures.

"This initiative is in line with Ayala's desire to participate in the power sector, especially in the realm of clean and renewable energy," Ayala general counsel Solomon Hermosura said in the disclosure.

The First Pacific group, for its part, is now the single biggest stockholder in power retailer Manila Electric Co.