A consortium including State Grid Corp of China is expected to
win the right to operate the Philippines' national power
transmission grid for a 25-year concession after posting a winning
bid of US$3.95 billion.
State Grid said it acts as the technical partner and 40-percent
equity shareholder in the group, which also includes Philippines
partners Monte Oro Grid Resources Corp and Calaca High Power
Corp.
The deal would be the biggest privatization in the Southeast
Asian nation's history.
Still, the consortium has to get a franchise to operate the grid
from the Philippines Congress within one year otherwise the right
will revert to the government. The Philippines government has been
trying to privatize TransCo to modernize the power industry.
The latest auction yesterday was the fifth after previous
attempts proved fruitless due to political uncertainty and concern
on low investment return. But a new tariff system put in place
since last year is supposed to make the 25-year license more
attractive to investors.
The winning bid narrowly beat the US$3.905 billion offer of the
sole rival bidder, a consortium led by San Miguel Energy Corp, a
unit of the Philippines' largest food and beverage company,
according to Power Sector Assets and Liabilities Management Corp,
which conducted the auction.
(Shanghai Daily December 14, 2007)
