Fresh from having entered into a partnership with the Lucio Tan group for Philippine Airlines, the head of San Miguel Corp. on Saturday said the diversified conglomerate was in an advanced stage of making a bid to acquire a large “regional company.”
In an interview, SMC president Ramon S. Ang declined to identify the acquisition target or the industry it was in, citing strict non-disclosure agreements. He did, however, disclose that the firm being considered was worth “at least $5 billion.”
He said the bidding process was now in the “final round,” and described the target firm further as a “private company.”
Ang said the company—whose owners have privately made an offer to sell through intermediaries—was expected to make an announcement in the near future about the prospective bidders that it would short-list.
“We will know soon if SMC will be included in the first three [on the short list],” he added, explaining that the conglomerate had already been short-listed earlier and that it was now aiming to be included in the “shorter short list.”
Previous to this, Ang had said that San Miguel made a bid to acquire a regional company involved in either the mining or energy fields, but he declined to disclose whether the current talks were linked to the group’s earlier efforts.
At the same time, the San Miguel chief said the conglomerate, through its power subsidiary, was ready to commence the building of power plants in both the Visayas and Mindanao with a combined capacity of 600 megawatts.
“We’ve signed a contract for the expansion of our power plants and we are about to start building,” he said, adding that the group has the option to double the capacity to 1,200 MW within the next 12 months.
“These are brand-new plants and greenfield projects,” Ang said. “These will be coal-fired power plants.”
At an average cost of $1.5 million per megawatt of rated capacity, San Miguel’s initial investment in this effort would be worth at least $900 million.
Ang spoke about San Miguel’s plans last Saturday on the sidelines of his meeting with French Prime Minister Jean-Marc Ayrault at the Hotel Sofitel in Pasay City where the ceremonial signing was held for Philippine Airlines’ $7-billon refleeting with new Airbus jets.
The San Miguel chief also expressed optimism that the group would soon be able to break ground on the Citra-PNCC alignment, a six-lane elevated tollway that would traverse Metro Manila and connect the South Luzon Expressway with the North Luzon Expressway.