Meralco to hike stake in Global Business Power

Manila Electric Co. (Meralco) is set to raise its stake in Global Business Power Corp. (GBPC), one of the largest independent power producers in the country and a member of the GT Capital group of taipan George Ty.

Meralco chair Manuel V. Pangilinan said that management already approved the acquisition of additional shares in GBPC.

He said First Metro Investment Corp., also a member of the GT Capital group, divested four percent of its shares in GBPC. Two percent will be taken up by Meralco through power generating arm Meralco PowerGen Corp. and the other two percent will be taken up by ORIX Corp. of Japan.

Pangilinan also said Meralco is open to investing further in GBPC if other shareholders were to sell their stake, citing the power firm’s good performance.

“It’s a good business, and the Metrobank group has managed it well, so [it’s a] good investment,” Pangilinan said on the sidelines of the company’s stockholders meeting.

As for the pricing, Meralco CFO Betty C. Siy-Yap said details on the acquisition of additional shares would be firmed up by June.

“What was approved was the acquisition; the pricing has yet to be formally advised,” Meralco president and CEO Oscar S. Reyes said.

The arrangements, when finalized, will see Meralco and Orix raise their respective stakes in GBPC to 22 percent from the existing 20 percent.

First Metro, after divesting four percent of its shares, will end up with a share of 5.11 percent. GT Capital remains the controlling shareholder with about 50.89-percent share of Global Business Power.

GBPC is a strategic partner for Meralco, which is exploring the possibility of extending its interim power supply agreements (Ipsas) to boost its power supply ahead of an anticipated tightness [due to] El Niño around mid-year. Meralco has Ipsas with GBPC’s Toledo Power Co. and Panay Power Corp., both of which started supplying to Meralco last April 3 while awaiting final regulatory approval.

The two were credited by Meralco for helping bring down overall power costs for its clients this May.

GT Capital Holdings Inc. is the listed investment holding company of the Ty family, with businesses that include GBPC, First Metro, Metropolitan Bank and Trust Company (Metrobank), Toyota Motor Philippines, Federal Land, Inc., Philippine AXA Life Insurance Corp. and Charter Ping An Insurance Corp.