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Publish Date : 18-Jan-2010

The Securities and Exchange Commission sees no need yet for the First Pacific group to make a tender offer for Manila Electric Co. in the aftermath of a controversial deal with the Lopezes to solidify its control over the country’s biggest power retailer. The state-controlled pension fund Government Service Insurance System earlier asked the SEC to compel the Manuel V. Pangilinan group to buy out other Meralco shareholders at the same effective valuation of P300-a-share that it had agreed with the Lopezes to acquire the additional Meralco shares.

First Pacific Co. Ltd.’s local infrastructure arm Metro Pacific Investments Corp. and mobile telecommunication unit Pilipino Telephone Corp. (Piltel) together control 34.7 percent of Meralco. The Lopezes gave MPIC the option to buy an additional 6.7-percent stake by end-March this year, which can jack up its interest in the utility to 41.7 percent, thus exceeding the 35-percent tender offer trigger. The SEC has issued a similar view when diversifying conglomerate San Miguel Corp. acquired from the Ashmore group a two-year option to take over a majority stake in the country’s biggest oil refiner Petron Corp.

In a petition filed with the SEC last year, GSIS urged regulators to force the Pangilinan-led MPIC to extend to other minority shareholders the same deal hatched with the Lopezes’ First Holdings. GSIS argued that the combined acquisitions by the Pangilinan group within the 12-month period had breached the 35-percent equity share limit under Section 19 of the Securities Regulation Code.

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