Alvarez consolidates ownership of Philphos

The group of Jose Ch. Alvarez is consolidating its ownership of the Philippine Phosphate Fertilizer Corp. (Philphos).

The Alvarez-led Delphi Holdings Inc. acquired 40 percent of Philphos by buying out the Philippine government in 2000. Delphi paid the Philippine government P3.025 billion for its stake.

Philphos was established 30 years ago as a joint venture between the Philippine government and the Republic of Nauru.

According to Alvarez, Delphi Holdings Inc. is setting aside $60 million to acquire the 40-percent stake of Nauru. He said Delphi started buying out Nauru in 2001 and has so far acquired 10 percent of Nauru’s stake.

Alvarez’s group, however, is not paying a premium to acquire Nauru’s remaining shares. According to Alvarez, "we are going to pay them whatever they paid to the government."

When Philphos was established in the late 1970s, the Philippines and Nauru each put in $60 million.

Unfortunately, Philphos did not generate any profits. In fact, Alvarez said, Philphos posted an average loss of P2 billion a year for 18 years.

However, with the takeover by the Alvarez group, Philphos has begun to turn around, posing a profit of P300 million last year. It is expected to perform even better this year with a projected net income of P500 million.– Marianne Go