MVP fortifies Meralco control but pricing stalls GMA-7 talks


It seems super executive Manuel V. Pangilinan has built enough firewall in Manila Electric Co. to thwart any attempt from rival businessman Ramon S. Ang to wrestle control of the country’s biggest power retailer.


The grapevine said Mr. Pangilinan, popularly known as MVP, sealed the Meralco deal as early
as Friday last week, after getting the nod of the Lopez Group to sell 30 million shares held by First Philippine Utilities Corp., a unit of First Philippine Holdings Corp., in Meralco for P295 each, or P8.85 billion.


MVP finalized the transaction through Beacon Electric Asset Holdings Inc., which has consolidated all the Meralco holdings of Philippine Long Distance Telephone Co. and Metro Pacific Investments Corp. Metro Pacific and PLDT Communications and Energy Ventures Inc. (formerly Pilipino Telephone Corp.) each own 50 percent of Beacon Electric.


Beacon said in a stock exchange disclosure that the acquisition would raise its beneficial interest in Meralco to 48.02 percent, solidifying its control of the utility. First Holdings, in a separate disclosure, said unit FPUC will continue to own approximately 3.9 percent of Meralco after the transaction is completed.


Simultaneously with the execution of the purchase agreement, Beacon, Metro Pacific, PLDT Communications and Energy and PLDT signed an agreement allowing the Lopez Group to retain a board seat in Meralco under certain conditions after the completion of the transaction.


Top 100 stockholders


The list of the top 100 stockholders of Meralco as of Dec. 31, 2011 curiously did not include FPUC. The companies or persons associated with the Lopez Group include First Holdings with 44.38 million shares or 3.94 percent; First Philippine Union Fenosa Inc. (a former major owner of Meralco and a partner of the Lopez Group during the pre-MVP days), 29.94 million shares or 2.66 percent; employee stock ownership plan, 13.98 million shares or 1.24 percent; Manuel M. Lopez or Ma. Teresa L. Lopez, 0.12 percent; and Manuel M. Lopez, 0.07 percent.


The same list had Beacon Electric as the single-biggest shareholder with 480.03 million shares or 42.59 percent and San Miguel Corp. as the second largest with 241.87 million shares, or 21.46 percent.


Ang, the president and chief executive of San Miguel, may now have a hard time dislodging the MVP-Lopez Group tandem from controlling Meralco. The San Miguel group, including the 5.24 percent holdings of San Miguel Purefoods Co. Inc., owns 26.77 percent of Meralco.


An unnamed Filipino nominee and one foreign nominee hold a combined 9.3 percent in Meralco. The Social Security System owns 5.59 percent of the utility, making it the fourth- largest stockholder of the utility after the third-ranked Filipino nominee. The Government Service Insurance System is the eighth biggest owner of Meralco with a 2.8-percent share.


Assuming the two nominees and the two pension funds sell their shares to San Miguel, the diversified conglomerate will end up with a total of 43.3 percent of Meralco, or far short of Beacon’s claim of 48.02 percent.


Raising the ante


Despite an official denial from GMA Network, the second-largest broadcasting company in the Philippines is still in talks to sell the station to MVP. The grapevine said preliminary talks between the two camps were temporarily stalled when the radio and television network, which airs on Channel 7 on free TV, offered a P40-billion price tag to MVP.


The grapevine said MVP immediately balked at the offer after initially dangling P25 billion. MVP, though, is still amenable to raising his bid to at least P30 billion. MVP has not officially denied speculations that his group was keen on acquiring GMA-7.


MediaQuest Holdings Inc., the media holding company of the PLDT Beneficial Trust Fund, earlier tried to buy 66.67 percent of GMA-7 for P8.5 billion. Negotiations failed through after MediaQuest lowered the valuation of the broadcasting company to about P12 billion from P14.58 billion.


MediaQuest acquired Associated Broadcasting Corp., operator of TV-5, in 2009 from businessman Antonio “Tonyboy” Cojuangco.


E-mail: rayenano@yahoo.com; extrastory2000@gmail.com

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