By Myrna M. Velasco
The Philippine Competition Commission (PCC) has approved the shares acquisition of listed firm Synergy Grid & Development Phils. Inc. into two companies holding major equity in the National Grid Corporation of the Philippines.
The shares acquisitions are with OneTaipan Holdings Inc. and Pacifica21 Holdings, Inc., that own the combined 60-percent shareholdings in NGCP, the operator of the country’s transmission assets.
OneTaipan of Henry Sy Jr. has a controlling stake in Monte Oro Grid Resources Corporation that in turn holds 30-percent equity in NGCP; while Pacifica21 of Robert Coyiuto Jr. has majority shareholdings in Calaca High Power Cor¬poration which holds the other 30-percent in the transmission company.
The acquiring firm Synergy is an affiliate company of the two firms – wherein Sy is the chairman; and Coyiuto is a board director.
Upon the completion of the transaction, the anti-trust body emphasized that such “will lead to Synergy directly controlling OneTaipan and Pacifica21,” and the two companies effectively becoming subsidiaries of Synergy.
PCC stipulated that it cleared the transaction because it is “unlikely to result in substantial lessening of competition in the Philippine market.”
The decision, it further noted, had been “based on the evaluation that the transaction will not result in any substantial change in the control, operations and management of NGCP.”
Additionally, the anti-trust agency reckoned that “the transaction will not likely lead to any significant change in the structure of the market for the provision of electricity transmission services.”
The PCC similarly highlighted that based on the findings of its mergers and acquisitions (M&A) office, “the corresponding equity acquisition by Mr. Henry Sy Jr. and Mr. Robert Coyiuto Jr. in Synergy does not meet the size of the transaction threshold provided under the antitrust law’s regulations, and does not appear to result in a change in control of Synergy.”
Sy has 44. 5 - percent outstanding capital stock in Synergy; while Coyiuto has 34-percent shareholdings in the acquiring listed firm.
The PCC also laid down the plan of Synergy to “increase its authorized capital stock from ₱50 million to ₱5.050 billion,” in which the ₱5.0 billion hike shall be divided into 5.0 billion common shares at a par value of P1.00 per share.
“Out of such increase in its authorized capital stock, 4,100,400,000 common shares of Synergy will be issued in exchange for outstanding shares of each of the two holding companies,” the competition body expounded.