The fighting, which began before dawn in the nearby town of Pikit yesterday, was still raging and threatened to spill over into territory claimed by the Moro Islamic Liberation Front which is negotiating peace with the government, Maj. Julieto Ando, spokesman of the Armys 6th Infantry Division, said.
Ando said a member of the kidnapping gang was arrested late Friday and tipped the military off about the location of a "satellite group" of the Pentagon in Pikit town, prompting the soldiers to assault the area a few hours later.
About 20,000 people have fled their homes for fear of getting caught in the fighting.
At least two soldiers, identified as Corporals Ramil Binoya and Angelbert Celestial, both of the 40th Infantry Battalion, were wounded in the firefight in Barangay Bulod.
One of the slain Pentagon men was identified as Titingan Abdulbasit, the groups radio operator.
The Pentagon, a network of kidnappers - mostly rogue Muslim rebels - have been abducting people for ransom in Central Mindanao in recent months.
They seized four Chinese working on a road project and a Filipino guide in two incidents in June and August. Two of the Chinese were later killed in a military rescue attempt, one escaped and the other was freed after the intercession of the Libyan government. The Filipino guide was also freed.
The Pentagon is also believed responsible for the recent abduction of a seven-year-old son of Chinese-Filipino trader Jimmy Yap Sr. of Pikit and the kidnapping of 33-year-old Martina Martin, a daughter of a rice mill owner in nearby Libungan town.
The boy was released without ransom, reportedly after Pikit residents threatened to torch the houses of the kidnappers relatives in the municipality. Martin is still held hostage. The Pentagon is asking for a P15-million ransom.
Eid Kabalu, MILF spokesman, said the clash was taking place close to an area claimed by the rebel group and warned that if it spreads, the MILF might be affected.
However, Ando said they would continue pursuing the kidnappers even if they flee into MILF-held areas.
The government and the MILF have signed a ceasefire to allow the holding of peace talks. Despite this, sporadic clashes between the two sides continue to take place. Joel Unson