Manila Electric Co. is finalizing various agreements in preparation for the takeover by a Meralco-led international consortium of Ghana’s biggest electricity distributor by February 2019.
Meralco president and chief executive Oscar S. Reyes said in an interview the company was expected to pour into the project some $40 million over five to seven years.
The consortium itself is expected to invest $581 million in the first five years of the 20-year concession period.
“We are working with the MiDA (Millennium Development Authority) and ECG (Electricity Company of Ghana Ltd.) for proper transfer by the first quarter of 2019,” Reyes said.
He said various agreements—shareholder agreements, joint development agreements, financing agreements—were undergoing “crafting, finalization and signing.”
Meralco has five partners in the Ghana concession, with Aenergia SA being the only other non-Ghanaian company in the group. Reyes described Aenergia as a Portuguese company with significant operations in Angola.
Meralco has a 30-percent stake in the entity that holds the concession while Aenergia has 19 percent.
A combined 51-percent stake is shared by Ghanaian firms TG Energy Solutions (18 percent), Santa Baron Ventures Ghana (13 percent), GTS Engineering Ghana Ltd. (10 percent), and TBK Ghana Ltd. (10 percent).
“We are required to have a 30 percent equity in the consortium, which is the Power Distribution Services [or PDS Ltd.], but we are allowed to have as low as 19 percent,” Reyes said. “Some parties are asking as allow them to participate as they see this as an attractive investment.”