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business The Manila Times SATURDAY December 11, 2010


JG Summit plans to raise equity J


BY KRISTA ANGELA M. MONTEALEGRE REPORTER


G Summit Holdings Inc. said it will sell shares to raise funds for its projects.


In a disclosure to the Philippine Stock Exchange, the holding com-


pany said the Gokongwei family would sell 2.09 billion existing common shares and subscribe to the company’s issuance of new shares, which would be in the same number as the shares sold during the offer.


The new shares will be listed as soon as practicable, the holding firm said.


A. Brown buys DMCI unit


A UNIT of DMCI Holdings Inc. has sold its en- tire stake in DMCI Concepcion Power Corp. to a wholly owned subsidiary of A Brown Co. Inc. In a disclosure to the Philippine Stock Exchange, DMCI Holdings said DMCI Power Corp. sold its entire common shares in DMCI Concepcion to Palm Thermal Consolidated Corp. Panay Consolidated Land Holdings Corp., another unit of A. Brown, will also acquire a 30-hectare property in Concepcion, Iloilo, a proposed site for DMCI Concepcion’s 100- megawatt coal-fired thermal power plant. A. Brown had said the deal would only take effect once DMCI Power complied with certain conditions precedent, includ- ing obtaining the requisite corporate and regulatory approvals and after the conduct of satisfactory due diligence.


Last month, A. Brown bought 95 percent


of Palm Thermal’s outstanding capital stock, and 100 percent of Panay Consolidated. Palm Thermal and Panay Consolidated, whose primary purpose is to purchase, own, and sell property and shares of stock, are seeking Securities and Exchange Com- mission approval of incorporation. In the first nine months, DMCI Hold-


ings’ earnings rose 79 percent to P5.8 bil- lion from P3.2 billion last year. Its shares fell from P36 on Thursday to


P34.10 each on Friday. KRISTA ANGELA M. MONTEALEGRE


The company’s board of directors also


approved the creation of 4 billion voting and non-redeemable preferred shares with a par value of P0.01 per share with a total par value of P40 million. JG Summit would also amend Article


Seven of its Amended Articles of Incorpo- ration to implement the increase in its au- thorized capital stock from P14.85 billion to P14.89 billion.


The proposed changes will be presented to shareholders in a special meeting on January 27, 2011.


Late last month, the Board of Invest- ments (BOI) announced that the Gokongwei group would start construction of its much-delayed $500-million naptha cracker project in Batangas.


Construction will begin next month and the plant will be operational by 2013, a year later under its revised registration. Originally registered with the BOI in


2005, the plant was scheduled to begin commercial operations in 2008. In 2008, the project was again moved to


Govt may pursue nuclear plant under PPP


PUBLIC-PRIVATE partnership (PPP) will play a crucial role if and when the govern- ment chooses to revive the Philippines’ nuclear power program, an official said. During a forum, Froilan Tampinco, presi- dent of state-owned National Power Corp. (Napocor), said the government can course nuclear power development through its PPP program. “There can be a possible strategic partner- ship between the government and the pri- vate sector in order to take care of handling a possible entry of nuclear facility,” he said. The government, however, has yet to of- fer a firm stand on whether it would push through with nuclear power technology af-


ter opposition from various environmen- tal and cause-oriented groups led to the mothballing of the Bataan Nuclear Power Plant (BNPP) in the 1980s. Earlier, the Department of Energy (DOE) and its allied agencies such as Napocor, al- located P100 million for studies on nuclear power development next year. But Energy Secretary Jose Rene Almendras said that the studies were part of the coun- try’s commitment to the Asean to come up with common safety standards and were not a direct endorsement of nuclear power. “It’s going to take a while. We’re not say-


ing [we’re] going to go there. We’re saying we need to understand the new technol-


ogy,” Almendras said. Compared with other conventional


power plants, nuclear power facilities pro- duce cheap electricity and a secure supply since it takes a longer time to deplete the fuel supply. Tampinco said the government would


have to consider building power plants of a smaller scale—less than 1,000 megawatts— should it forge ahead with nuclear energy. “If such a plant gets out of the system—it will certainly with that size—introduce a lot of instability in the network so we need to confine ourselves in a size. The BNPP in fact is identifiably, with 600 megawatts,” he said. EUAN PAULO C. AÑONUEVO


Albay power utility proposes five-year capex


CASH-STRAPPED Albay Electric Coopera- tive Inc. (Aleco) has proposed a billion-peso spending program for the next five years. In a petition before the Energy Regula- tory Commission (ERC), Aleco proposed P957.09 million in capital expenditures (capex) for a number of subtransmissions, substations, distribution lines and rural electrification projects from 2010 to 2014, as well as for debt servicing.


The proposed investment will be fi- nanced through internally generated funds and borrowings from state-run National Electrification Administration. The utility is also banking on the subsidy it gets from


the government’s rural electrification pro- gram and the loan from state-run National Transmission Corp. for the acquisition of subtransmission lines. To recover the amount, Aleco proposed


an average increase of P0.18 per kilowatt- hour for the period, which will jack up its average rate to P737 per kilowatt-hour. “The cooperative can viably pursue and implement the capex plan if and only when the corresponding rate per [kilowatt-hour] is at least equivalent to the total revenue requirement,” Aleco said.


The cooperative distributes electricity to the province of Albay, a typhoon-prone area


in the Bicol region. From 2008 to 2010, state-owned National


Power Corp. (Napocor) took over Aleco to ensure its financial viability and restructure the utility’s P1.59-billion obligation to the former. The agreement was implemented from July 17, 2008 to July 16, 2009 but was ex- tended on a monthly basis until February 23, 2010 upon the mutual consent of Aleco and Napocor.


Despite Napocor’s take-over, Aleco’s fran-


chise was still hit by power shortages because of the cooperative’s failure to secure supply contracts with generating companies. EUAN PAULO C. AÑONUEVO


business inbrief


January 2012 since project costs had al- ready surged because of the foreign ex- change depreciation.


Last month, JG Summit unit Robinsons Land Corp. also approved an increase in its authorized capital stock from P3 billion to P8.2 billion.


The nine-month income of JG Summit – which has interests in food and beverage, airlines, banking, property, telecommunica- tions and petrochemicals—reached P12.77 billion, 113 percent higher than last year’s P5.99 billion.


Its shares fell from P24.45 on Thursday to P23.80 each on Friday.


■ THE Bureau of Customs (BOC) is seeking additional budget for 78 new personnel that would be deployed in international airports. BOC had earlier secured the Philippine Airlines’ commitment to settle some of the existing workers’ overtime pay for five months amounting to P160 million. KATRINA MENNEN A. VALDEZ


■ THE Meat Importers and Traders Associa- tion Inc asked the Department of Agriculture to immediately defer the implementation of the rules in the handling of frozen and chilled meat products amid the influx of imported and local frozen meat products. The group said they were not consulted with the implementa- tion of the order. JAMES KONSTANTIN GALVEZ


■ THE German Technical Cooperation (GTZ) has called on the Philippine government to strengthen its consultative land use planning and policy to ensure resource sustainability and to secure the people’s rights to land. GTZ said investments in agriculture, rural areas as well as business opportunities are of critical importance in the country’s development goals. JAMES KONSTANTIN GALVEZ


■ THE Bureau of Customs is bullish that it would substantially improve its collection next year. The agency said that sustained economic growth should lead to higher volume of incoming shipments as local manufacturers meet the growing demand from both the local and overseas markets.KATRINA MENNEN A. VALDEZ


■ THE Philippine Coconut Authority said that total exports of coconut products will likely reach $1.57 billion this year, up by 78 percent from $884 million in 2009. The volume of coconut exports is also seen to reach 2.356 million metric tons (MT) this year or a 55.5-percent increase from 1.515 million MT last year. JAMES KONSTANTIN GALVEZ


■ THE Asian Development Bank said it will provide the Philippines with a $200-million loan assistance for phase 2 of the Financial Market Regulation and Intermediation Program. This aims to improve financial sector stability, increase the efficiency and liquidity of markets, and strengthen the regulatory environment in the wake of the global economic crisis. DARWIN G. AMOJELAR


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