Manila Electric Co. (Meralco), the country’s biggest power distributor, plans to divest itself of its entire stake in Rockwell Land Corp. to focus its resources on its core business and related power projects.
In a disclosure to the Philippine Stock Exchange, Meralco said that the proposed divestment of the Rockwell stake will be carried out through the “declaration of all Meralco’s shares in Rockwell as property dividends [to shareholders] and subsequent listing by way of introduction” or listing on the local bourse without an immediate public offering.
“We’ve been doing a strategic review of our businesses, subsidiaries and affiliates and we just felt that real property development was far from our core business… The plan is to divest our shareholdings so we can focus on more strategic areas that are close to our core business of distributing power,” Oscar S. Reyes, senior executive vice president and chief operating officer of Meralco, said in a phone interview Monday.
“We’ve indicated that clearly, our growth platforms would be in the areas of distributing power and together with that is to develop our power generation portfolio, which will enable us not only to contain power prices, but become part of the whole solution in terms of providing adequate, reliable and affordable power supply,” Reyes told the Inquirer.
Meralco currently has a 51-percent stake in Rockwell Land, with the remaining 49 percent held by the Lopez-led First Philippine Holdings Corp.
Rockwell Land, one of the premier real estate development companies in the country, was formed by the Lopez Group in 1995, following the shutdown of the thermal power plant.
The old power plant site—a 15.5-hectare property in Makati City—was developed into a high-end commercial business district now known as the Rockwell Center.
In another development, Meralco disclosed that it was given the go-ahead by its board of directors to enter into power supply agreements with three power generation firms.
Meralco said that it was granted authority to forge agreements with San Miguel Corp.’s power unit, South Premiere Power Corp.; Masinloc Power Partners Co. Ltd., the local unit of US-based power giant AES Corp.; and Sem-Calaca Power Corp., a wholly owned subsidiary of Semirara Mining Corp.