Cosco buys Liquigaz

From https://www.coscocapital.com/

MANILA, Philippines—Cosco Capital has diversified into the liquefied petroleum gas (LPG) distribution business with the completion of its acquisition of Liquigaz Philippines.

The purchase of Liquigaz was done through Canaria Holdings Corp., which is 90 percent-owned by Cosco and 10 percent-owned by PR Gaz, Inc.

Liquigaz is the second largest supplier of LPG in the country, accounting for about 30 percent of the total market volume. It is the biggest supplier of LPG in Luzon, the site of its LPG storage facilities.

Over 60 percent of the country’s total annual LPG importation is unloaded, stored and sold from Liquigaz’s 12,500-metric-ton capacity storage tanks in Mariveles, Bataan, the largest of such facility in the Philippines. It is the only supplier capable of receiving both refrigerated and pressurized LPG cargo.

Liquigaz is also into the wholesaling segment of the LPG market, with 85 percent of its traded volume going to refillers and distributors. It is the industry leader in this segment of the LPG market. The remaining 15 percent is sold to commercial end-users such as restaurants, hotels, fast food outlets, hospitals, supermarkets and autogas stations.

“With a very strong presence in the upstream LPG wholesale business, Liquigaz shall provide Cosco Capital the entry point into the downstream LPG retail business,” Cosco said in a disclosure to the Philippine Stock Exchange on Monday.

“Cosco Capital envisions its entry into the downstream LPG retail business through mergers and acquisitions of existing LPG refillers and retailers or via the establishment of its own LPG refilling and retailing network. Cosco Capital likewise envisions the direct LPG retailing to the wider household end-user market by way of leveraging on the market reach of the Puregold hypermarkets, supermarkets and extra stores,” the company said.

Based on the 2011 Household Energy Consumption Survey of the National Statistics Office, which was released at end-2013, only about 41 percent of the 21 million households in 2011 were using LPG as fuel for cooking. Majority of the households, at about 54 percent in 2011, were still using fuelwood for cooking.

“The downstream LPG retail business is expected then to meet the demand for the use of LPG for cooking with the continuing economic development of the country,” the company said.

Once a purely oil, gas and mining play Alcorn Gold Resources Corp. (APM), Cosco has been converted into the Lucio Co’s  family holding firm for flagship Puregold Price Club as well as other businesses like non-food retailing, liquor distribution, commercial real estate and oil storage.