- Category: Top News
08 Jun 2013
- Written by Joyce Koh & Cecilia Yap / Bloomberg News
San Miguel Corp. is working with four banks to help it sell a $3.3-billion stake in the Manila Electric Co., the Philippines’s largest utility, said three people with knowledge of the matter.
Citigroup Inc., Deutsche Bank AG, Standard Chartered Plc. and UBS AG are helping San Miguel explore how to divest the holding, the people said, asking not to be named as the appointments are private. Options include selling a portion to another company and the remainder to large institutional investors, they said.
San Miguel said this week that unidentified parties have expressed interest in its stake in Manila Electric Co., or Meralco as the company is known, and proceeds from any sale will fund expansion in oil and gas. The company and units San Miguel Pure Foods Co. Inc. and SMC Global Power Holdings Corp. own about a combined 32.8-percent stake, worth P140.2 billion ($3.3 billion), based on Meralco’s market value.
A stake sale to another company could mark the third-biggest acquisition in the Philippines, data compiled by Bloomberg show. An equity-market transaction, such as a private placement, would be the country’s biggest of its kind, the data show. Meralco shares have rallied 45 percent this year, giving it a market value of P427 billion.
San Miguel President Ramon S. Ang and Chief Finance Officer Ferdinand Constantino didn’t reply to mobile-phone calls and text messages seeking comment on the appointments. Spokesmen for the four banks declined to comment or weren’t immediately available.
Ang said this week that San Miguel, the Philippines’s biggest company by sales, might sell the Meralco stake this year. San Miguel bought the bulk of the shares at P90 each—less than a quarter of Friday’s market closing price of P379.
Meralco is the largest distribution utility in the Philippines, serving a quarter of the country’s population in an area that accounts for half of its gross domestic product, according to its web site. The company said in April that first-quarter net income rose 19 percent to P4 billion.
In Photo: San Miguel President Ramon S. Ang