Power team-up looms between MVP, RSA camps

Another partnership looms between the camps of Manuel V. Pangilinan and Ramon S. Ang as talks for a possible deal in power generation have started.

In a disclosure to the Philippine Stock Exchange yesterday, San Miguel Corp. (SMC) said it is discussing with Manila Electric Co. (Meralco) a possible investment of up to 49 percent in South Premiere Power Corp. (SPPC).

SPPC, an affiliate of SMC, is the independent power producer administrator (IPPA) of the 1,200-megawatt Ilijan power plant in Pangasinan.

Ang is the vice chairman, president and chief operating officer of food-to-infrastructure conglomerate SMC while Pangilinan chairs power distribution giant Meralco.

“We offered to sell 49 percent of Ilijan power plant to Meralco and we are in talks but we can only close the deal once the court case which we have filed against PSALM has been resolved,” Ang told reporters yesterday after the annual stockholders meeting of Top Frontier Investment Holdings Inc.

Ang said that by selling to Meralco, the plant is assured of an off-take agreement up to 2022.

He stressed, however, the deal depends on the resolution of the case filed against Power Sector Assets and Liabilities and Management Corp. (PSALM).

Earlier this week, Meralco president Oscar Reyes said the company is in “very early discussions” with the San Miguel Group for a possible deal for the Ilijan power plant.

“It’s in very early stage (of discussion). We’re just taking a look at what it is,” he said.

However, SMC said the possible deal with Meralco is still subject to the resolution of the pending case lodged by SPPC against the PSALM.

“An appropriate disclosure shall be made in the event a definitive agreement is concluded between the parties,” it said.

SMC, through its power subsidiary SMC Global Power Inc., filed a legal case against PSALM for the “intentional breach of contract” by terminating the IPPA agreement for the Ilijan plant with SPPC.

PSALM said it terminated the IPPA agreement after SPPC failed to pay the outstanding generation payments from Dec. 26, 2012 to April 25, 2015 amounting to P6.46 billion.

The case is still pending in a Mandaluyong City regional trial court.

Pangilinan and Ang have been tagged as rivals or “frenemies” for having faced each other in biddings for airlines, television networks, infrastructure projects, including public- private partnership projects, among others.

But their team up started through Gilas Pilipinas, the Philippines’ national basketball team.

“Look what basketball can do, Ramon Ang and I are now business partners,” Pangilinan said during the BusinessWorld Economic Forum 2016 held Tuesday.

According to earlier reports, Meralco’s power generating unit Meralco PowerGen Corp. acquired a 49 percent stake in SMC Global’s Mariveles Power Generation Corp. (MPGC), marking Pangilinan and Ang’s first joint venture together.

MPGC is building a 4x150-MW circulating fluidized bed coal-fired power generating facility in Mariveles, Bataan, eyed for completion in 2019.