Listed SPC Power Corp. has asserted its right to beat the highest bid for the 153.1MW Naga power facility in Cebu province being privatized by the Power Sector Assets and Liabilities Management Corp. or PSALM.
In a statement, SPC said it has wired the amount of P1.143 billion, an amount five percent higher than the P1.088 billion offer of the highest bidder, to the Development Bank of Philippines account of PSALM
SPC said it made the move on Tuesday night “as a sign of good faith.”
The company exercised its right to top following the issuance of the notice by PSALM president Emmanuel Ledesma Jr. dated April 27 that Therma Visayas Inc. of the Aboitiz Group was declared the winning bidder for the Naga facility.
PSALM notified SPC to top the winning bid by five percent or P1.143 billion to be paid within 30 days upon receipt of the notice.
“With the payment, we expect PSALM to sign and execute, as the counter party, the Asset Purchase Agreement and the Land Lease Agreement attached in the bidding package which SPC had already prescribed,” SPC said in a letter to PSALM.
In April, PSALM rebidded the facility after two failed auctions in 2013. The condition of the sale provides that SPC has the right to “top” the price of the winning bidder for the Naga plant by five percent, as provided under the land lease agreement between PSALM and SPC in 2009 for the Naga land-based gas turbine.
The sale also includes a land lease agreement for the land underlying the power plants. As previously disclosed by Psalm, the Naga plant is being sold as a merchant plant. That is, without an attached power supply contract.
Formerly Salcon Power, SPC operates the Naga complex through an operations and maintenance agreement with PSALM. SPC’s right to top stems from a provision of its Land Lease Agreement with PSALM for the 55MW Naga Land-Based Gas Turbine.
Located in Colon, Naga City, Cebu, the Naga Power Plant consists of two thermal power plants and one diesel-fired power plant that use a combination of coal, bunker oil and diesel as fuel.