By Myrna M. Velasco – November 2, 2016, 10:01 PM
from Manila Bulletin
SPC Power Corporation has elevated to the Supreme Court (SC) en banc its motion for reconsideration on the questioned sale process of the 153.1-megawatt Naga thermal power facility.
That had been culled from the disclosure of Aboitiz Power Corporation to the Philippine Stock Exchange – the company’s subsidiary Therma Visayas Power, Inc. (TVPI) is a relevant intervening party to the case filed by former Senator Sergio Osmena III relating to the divestment of the Naga asset in Cebu.
SPC Power previously indicated that it anchored its argument on the fact that the SC ruling will shortchange government because of the voided right-to-top provision in bidding terms that could have added 5.0-percent to the facility’s purchase offer.
That had been P54 million higher versus the P1.088 billion bid put up by TVPI of the Aboitiz Group, the next prospective awardee of the Naga plant following the SC decision.
In getting hold of the facility back in September 2014, SPC Power which was accorded the right-to-top option, paid P1.143 billion then to asset-seller Power Sector Assets and Liabilities Management Corporation.
But that had been thwarted in the SC verdict, which is directing PSALM to take back an asset already awarded to purported winner of its bidding exercise.
PSALM earlier noted that the payment for the asset is still “untouched,” and placed in a special account labeled as ‘restricted’.
In earlier statement to the media, publicly listed SPC Power stipulated that the recent ruling of the Supreme Court had been grossly disadvantageous to the government.” Additionally, SPC has emphasized that the high court decision “destabilizes the investment climate in the Philippines and retroactively changes the rules on competitive bidding.”
It reiterated that “with the Supreme Court ruling to reinstate the notice of award to TVPI, the government not only stand to lose P54 million but is deprived of a rebid of the Naga power plant which would likely result in an even higher price for the government.”
Notably, the SC decision inferred that the Naga plant be bequeathed to the Aboitiz Group as it reinstated the award notice previously set for the company – that was following nullification of the right-to-top proviso in the asset’s bidding terms.
SPC Power stressed that the SC decision in fact counters its own stance that competitive bidding for government assets would have been the more prudent way to corner favorable proceeds.
The high court averred at its September 26, 2016 judgment that “attracting as many bidders to participate in bidding for public assets is still the better means to secure the best bid for the government and achieve the objective under EPIRA (Electric Power Industry Reform Act to privatize NPC (National Power Corporation) assets in the most optimal manner.”