GMA presses Transco privatization

ILOILO CITY – President Arroyo, who led the groundbreaking ceremony for the new Mirant Philippines/Global Business Holdings Inc. of the Metrobank group, reiterated her call for the privatization of the National Transmission Corp. (Transco).

"There is a need to upgrade the transmission system of Transco and make these interconnection projects. These efforts are geared toward making medium and long-term solutions to the looming power shortage starting from Visayas. But we need to start planning now," the Chief Executive said.

President Arroyo also expressed confidence that Transco can successfully pull off its privatization. "One bidder is good enough. At least we have one bidder. If we only have one bidder, this will also allow us to conduct another bidding," Mrs. Arroyo said.

In a related development, Metrobank chairman George Ty said they are looking at the possibility of bidding for some generation assets of the National Power Corp.

The Power Sector Assets and Liabilities Management Corp. (PSALM), an agency mandated to handle the privatization of Napocor assets, has decided to simultaneously sell some of the generation assets of the state-run power firm along with the auction for the lease contract for Transco.

The Metrobank group through its investment vehicle Global Business Holdings Inc. (GBHI) started its first investment in the power sector when it forged a joint venture with Mirant Philippines Inc. to expand the operation of Panay Power Corp. by 40 MW from the present 72 MW.

"We are always looking for opportunities to do business and at the same time help our countrymen. Why don’t we do it. We will always consider (bidding for Napocor generation assets)," Ty said, noting that the investment in power will probably boost their income performance this year to P3 billion from 2002’s P2.5 billion.

But Ty said they would consider some factors before they could start another venture into the power business.

He noted that with regards to their investment in PPC, Metrobank already has a $40-million loan to the Lopez group. "As far as we are concerned, there is a history in this Panay thing. Before we decided to invest in this project, we already granted the Lopez group $40 million loan. So it is but natural that we come in to this. But aside from that, we (Metrobank) have been here in Iloilo for 35 years."

Ty said they have not decided yet how much investment they would be pouring in the power business. "It depends on the opportunities," he said.

GBHI president Francis Sebastian, on the other hand, clarified that the Metrobank group did not enter into the power business just because it has $40 million loan exposure to the Lopez group.

"This has nothing to do with our loan with the Lopezes. This is a new investment and we really want to diversify our operations," Sebastian said. "Just like what Mr. Ty said we would like to do service to the country. When we came here we are welcomed because they know that there is really a power problem here."