Aboitiz sets expansion sights abroad
The Aboitiz group is scouting for offshore acquisition opportunities for its power and food businesses in line with the upcoming integration of Southeast Asian economies into a unified market by 2015.
The group also sees its flagship power businesses resuming an uptrend in earnings as early as next year as the adverse impact of the expired income tax holiday for the Pagbilao plant will be offset by fresh revenues from additional power generation capacity that would come onstream.
Starting next year, the group will thus likely see a rebound from this year’s decline in earnings, said Aboitiz Equity Ventures and Aboitiz Power Corp. president Erramon Aboitiz.
Aboitiz added that the group would keep its banking assets—now consolidated under Union Bank of the Philippines—and was preparing to boost the latter’s capital to be able to pursue growth opportunities.
Asked about Union Bank’s proposal to take over Export and Industry Bank, he said the group was always looking for such opportunities, but could not give a timetable.
On power, Aboitiz said that the group would look at different technologies and markets in Asia-Pacific.
Article continues after this advertisementAboitizPower is now looking at Indonesia, studying its geothermal and hydroelectric prospects.
Article continues after this advertisement“There are lots of opportunities in Indonesia,” Aboitiz said. “We are talking to some (potential) partners. But so far, we don’t have anything firm.”
He said Papua New Guinea is also an area of interest for AboitizPower.
“We will prefer to buy into an operating asset,” he said, referring to AEV’s brownfield preference when it comes to offshore investing.
In the Philippines, AboitizPower is investing P80 billion in both greenfield and brownfield projects to increase the group’s power generation capacity by about 2,000 megawatts in the next five years.
For the food business, expansion is underway, particularly in swine farming and the export of flour to the rest of Southeast Asia, said Sabin Aboitiz, president of food unit Pilmico Foods Corp.
The strategy will be to build Pilmico’s market here while it looks at exporting to the rest of Southeast Asia and take advantage of the region’s vast consumer base.
