Napocor buyers urged to list in stock exchange

Government will ask prospective buyers of the transmission and generation assets of the National Power Corp. (Napocor) to list at least 10 percent of their shares in the stock market, Energy Secretary Vincent S. Perez said yesterday.

"We might make it as a condition to the sale of the Napocor assets (both the transmission and the generation companies of the state-run power firm)," he said.

If possible, Perez said they would try to insert this particular proposal in the implementing rules and regulations (IRRs) of Republic Act 9136 or the Electric Power Industry Reform Act (EPIRA).

"Personally, I would like to encourage the new owners of the transco and gencos to list at the PSE (Philippine Stock Exchange) at least 10 percent of their shares within three years after the purchase," he said, adding this would help in the government’s effort to develop the capital market.

But he said government is not inclined to offer all the shares of transco and gencos in the stock market as they may be able to raise 15 to 20 percent more through a trade sale as compared to a public offering.

"The government had learned that a trade sale will give higher valuation," he said, adding that they are willing to give the buyers of the transco and gencos about eight to 10 percent rate of investment being the acceptable rate of return in the Asian power industry/market.

This week, the Power Sector Assets and Liabilities Management (PSALM) Corp. will get at least one to two financial advisors to handle the privatization of transco and gencos.

"We will announce our financial advisor this Thursday. We have some clarifications to make with the financial institutions that submitted proposals such as the clustering of gencos," he said.

The energy chief said they have received proposals to cluster the gencos to at least five to eight groupings with not less than 250 megawatt to not more than 1,500 MW.

However, Perez said they have yet to decide what privatization scheme to use, whether via outright sale or through concessions.

But he said they have already decided to push through with the privatization of the transco ahead of the gencos. By early this year, they would start auctioning off the transco. So far, Perez said they have received about six to eight proposals from various international transmission companies to participate in the sale of the National Transmission Co. – Donnabelle Gatdula