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Antitrust body approves 2 joint-venture deals

/ 05:52 AM February 24, 2018

The Philippine Competition Commission (PCC) has cleared two joint-venture projects related to real estate development and hydropower, with one of the parties being the Ayala group.

In a statement, the PCC said its mergers and acquisitions office found that the two partnerships—that of Ayala Land Inc. and Royal Asia Land Inc. as well as that of Markham Resources Corp. and Alternergy Mini Hydro Holdings Corp.—would not result in the substantial lessening of competition in their respective markets.

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No structural effect

“The transaction [between Ayala and Royal Asia] does not result in the substantial lessening of competition because it will not have a structural effect on the market,” the PCC said in a decision dated Feb. 20.

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Ayala Land and Royal Asia are setting up a joint venture to acquire, own and develop a 936-hectare property in Silang and Carmona, Cavite, into a mixed-use project with commercial and residential components.

The PCC said Royal Asia Land—a unit of PCO South Frontier Holdings Inc.—was incorporated to purchase, acquire, own, lease, sell and convey real properties.

Also, the PCC found that there were enough competitive constraints by other players in the hydropower market, even with a partnership between local firms Markham and Alternergy.

Joint-venture investment

The two firms had proposed a joint-venture investment in Kiangan Mini Hydro Corp., Ibulao Mini Hydro Corp. and Lamut-Asipulo Mini Hydro Corp.

Dubbed as the Markham-Alterenergy JV companies, these are Philippine special purpose companies that will be formed to operate, develop and maintain run-of-river mini hydro projects along the stretch of Asin, Ibulao, Hungduan, Lamut and Panubtuban Rivers in the Ifugao province.

Foreclosure

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The PCC said its review found no increased ability or incentive for the new joint venture to engage in foreclosure in the relevant market after the transaction.

“The transaction also does not appear to create or strengthen the ability or incentive of the merged firm to engage in withholding capacity,” the antitrust body said. —RONNEL W. DOMINGO

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