The government said it expects the Ashmore Group to finalize the payment for its 40 percent stake in Petron on or before Dec. 24 or up to five days from the signing of the sale agreement last Friday.
The government and the London-based investment fund manager signed the deal on Friday, paving the way for the transfer of the 40-percent stake held by state-owned Philippine National Oil Co. (PNOC) in the country’s largest oil refiner to Ashmore for P25.7 billion.
“We hope to get the proceeds on or before the 24th of December,” Finance Secretary Margarito Teves said.
Officials said the government expects net proceeds of P21 billion from the sale.
Of the total sale amounts, P4.4 billion would go to PNOC while the rest of the amount would be used to pay other expenses related to the sale such as financial advisory costs. The advisors of the sale include the Development Bank of the Philippines and Citibank.
The move to acquire the government’s 40 percent stake in Petron would give Ashmore a controlling stake in Petron as it would increase its ownership in the company to roughly 90 percent.
The Ashmore Group, represented in the country by former Trade Minister Roberto “Bobby” Ongpin already owns 51 percent of the company after it acquired the 40-percent stake of Saudi Arabia-based Aramco Overseas Co. in Petron for $550 million and made a tender offer to other shareholders early this year.
Food and beverage conglomerate San Miguel Corp. had already entered into an agreement with the Ashmore Group to buy 50.1 percent of the PNOC block.
With the transaction, Teves said the government is on track to meeting its programmed deficit ceiling of P75 billion for 2008.
The government gave the Ashmore Group until Dec. 5, 2008 to exercise its right of first refusal on the PNOC block in Petron.
The government has decided to sell its stake in Petron, considered a crown jewel in the oil industry, to raise revenues for social services and infrastructure projects.
The government’s sale of its stake in Petron, meanwhile, will end an era of state control in the oil refining business which started in the early 70s.
After Petron, the government hopes to sell other big ticket items next year such as the 120-hectare Food Terminals Inc. property in Taguig and its remaining 40 percent stake in PNOC-Exploration Corp.