Non-Asian firm eyes Transco

A non-Asian transmission firm has joined the list of foreign companies that have expressed interest to join the bidding for the National Transmission Corp. (Transco), Power Sector Assets and Liabilities Management Corp. (PSALM) president Edgardo del Fonso said over the weekend.

"There are now seven foreign firms that have signified keen interest to participate in the Transco bidding, Six of which are Asian firms and one is non-Asian," del Fonso said, refusing to say if the non-Asian firm is American or European.

Del Fonso said at least three local equity groups have also expressed interest. "These local firms are not technically qualified to run the Transco but they can participate if they will form a consortium," he said.

According to the PSALM chief, they can not reveal the identities of these groups as they will still have to undergo series of pre-qualification processes before they can join the bidding.

"After indication to bid, we will given them the information memorandum. Then, we will explain to them the bidding package. After which, they will be asked to sign an agreement and post a bond," he said.

After signing an agreement, del Fonso said the group can go on with its evaluation of the Transco assets including due diligence.

PSALM, under Republic Act 9136 or Electric Power Industry Reform Act of 2001, will absorb all the assets and liabilities of Napocor and will handle the power firm’s privatization. EPIRA also mandated the creation of Transco to handle the transmission assets of Napocor.

Del Fonso said based on the privatization rules, Transco will have to be 60 percent-owned by a local group and 40 percent by foreign investors.

According to del Fonso, the interested foreign investors will have to seek a local partner to meet the requirement of the law.

Last year, some big local conglomerate led by the Ayalas, Cojuangcos, and Gokongweis have expressed interest to participate in the Transco privatization.

Several foreign power firms have also indicated interest last year to bid for Transco. These power companies are based in Hong Kong, Thailand, Singapore and New Zealand.

The Konsortium Logistik Berhad (KLB), the biggest power company in Malaysia, has also indicated interest to bid for the transmission and generation assets of the Napocor.

Tenaga Nasional Berhad vice president for corporate affairs Datuk Sidek Bin Ahmad also expressed interest to look into the generating and transmission assets of Napocor.

Red Electrica, a Spain-based transmission group, had sent a team to the Philippines to study its bid for Transco.

Other groups led by Intergen, Mid American Energy Holdings Inc., Edison Mission Energy, Hydro Quebec, and National Grid have also expressed interest to join the Transco bidding.

Five Japanese firms: Kansai Electric Corp., Kyushu Electric Corp., Electric Power Development of Japan and Tokyo Electric also have plans to participate in the auction.