Metro Pacific group completes purchase of additional Meralco stake

MANILA, Philippines - The group of Metro Pacific Investments Corp. (MPIC) has completed the purchase of an additional 6.7 percent interest in power utility giant Manila Electric Co. (Meralco) through separate block sales crossed at the Philippine Stock Exchange yesterday.

Local stocks climbed to a fresh 25-month high, bolstered by three block sales in Meralco.

The three block sales, which involve  a total of 238.3 million common shares or approximately 21.1 percent of the power distributor, were valued at P46.95 billion. These transactions consist of 74.7 million shares acquired from Lopez-owned First Philippine Holdings Corp. for P300 per share for a total of P22.41 billion and 163.6 million shares transferred by MPIC to Beacon Electric Asset Holdings Inc. at P150 each or P24.54 billion.

CLSA and PCCI Securities Brokers Corp. handled the block sales.

MPIC transferred the shares in exchange for a 50 percent  stake in Beacon plus P8 billion of Beacon’s preferred shares. Pilipino Telephone Corp. (Piltel) will own the other 50 percent of Beacon after it contributes 154.2 million Meralco shares, also at a value of P150 a share. After the transfer, Piltel’s direct stake in Meralco will go down to 6.1 percent from 20 percent.

MPIC said it also completed yesterday the issuance of P6.6 billion worth of convertible bonds to Metro Pacific Holdings Inc.

The Lopez Group and Beacon Electric have also entered into a voting arrangement, which may be terminated by written notice of Beacon Electric, that in respect of matters that may be brought for approval by the board of directors of Meralco and without prejudice to the faithful performance of the directors’fiduciary duties, the directors of the Lopez Group and Beacon Electric in Meralco will vote as one block.

The Lopez Group also executed in favor of Piltel a pooling of votes agreement in respect of matters that may be brought for approval by the shareholders of Meralco, which may be terminated upon written notice by Piltel.