By Lenie Lectura – April 16, 2019
from Business Mirror
THE Philippine Competition Commission (PCC) has cleared the P6-billion power deal between AC Energy Inc. and the Phinma Group.
AC Energy and the Phinma Group said separately that they received approval from the PCC for AC Energy’s acquisition of Phinma Inc.’s and Phinma Corp.’s combined 51.48-percent stake in Phinma Energy Corp. (PHEN).
AC Energy is acquiring Phinma’s stake via a purchase of secondary shares for approximately P3.42 billion.
As part of the sale, AC Energy will subscribe to approximately P2.632 billion worth of primary shares of PHEN at par value, which will result in a total stake for AC Energy of around 68 percent, subject to the conduct of a tender offer for the shares of PHEN’s minority shareholders.
“PHN will sell 1,283,422,198 shares in PHEN to AC Energy, representing a 26.25-percent stake. PHI will likewise sell its 25.23-percent stake in PHEN to AC Energy. As part of the sale, AC Energy will also subscribe to approximately P2.632 billion worth of primary shares of PHEN at par value, which will result in a total stake for AC Energy of around 68 percent, subject to the conduct of a tender offer for the shares of PHEN’s minority shareholders,” they said in separate disclosures.
The PCC said that upon review, “it finds that the proposed acquisition by AC Energy of shares in PHEN will not likely result in substantial lessening of competition.”
The commission approved the deal because, among others, “the transaction does not substantially increase the likelihood that the parties will engage in anticompetitive coordinated behavior with other power generators.”
Moreover, the commission said the transaction “does not significantly strengthen the ability or incentive of the merged firm to engage in customer or input foreclosure” and that “competitive constraints remain from other players in the markets for power generation for bilateral contracts and the provision of Retail Electricity Supply services in Luzon and the Visayas.”