JG Summit trims stake in Meralco

MANILA, Philippines — JG Summit Holdings Inc., the holding company of the Gokongwei Group, has reduced its stake in Pangilinan-led Manila Electric Co. but remains the power distributor’s second biggest shareholder.

JG Summit raised P12.384 billion from the sale of 36 million Meralco shares for P344 apiece,   six percent lower than the  July 28 closing price of P366 per share.

Metro Pacific Investments Corp., which owns 45.5 percent  of Meralco, acquired some of the shares sold by JG Summit. Others were bought by other investors.

“We are raising cash to strengthen our balance sheet. We still retain our three board seats and we remain the second largest shareholder with 26.4 percent,” JG Summit president and CEO Lance Gokongwei said.

Prior to the transaction, JG Summit’s stake in Meralco was 29.6 percent.

In a separate disclosure, MPIC said it acquired an additional 22.5 million Meralco shares, equivalent to approximately two percent of the company’s issued and outstanding capital stock, for P7.7 billion.

As a result of the transaction, MPIC  now holds approximately 47.5 percent direct and indirect interest in Meralco.

The Gokongwei Group, through JG Summit , acquired ownership in Meralco in 2013 after buying the stake of San Miguel Corp. in the power utility firm, marking its foray into the lucrative power sector.

Meralco, chaired by Manuel V. Pangilinan, is the country’s biggest power distributor, with a franchise to operate in Metro Manila and many parts of Luzon.

JG Summit, meanwhile, is in different business interests such as foods; agro-industrial and commodities; real estate and hotel; air transportation; banking; and petrochemicals.