Lepanto shares soar on MVP takeover rumors

MANILA, Philippines - Shares of Lepanto Consolidated Mining Co., a primary gold producer, have been steadily rising the past several days on rumors that the group of telecommunications magnate Manny V. Pangilinan is interested in acquiring the listed mining firm.

From only P0.17 last July 9, Lepanto shares have risen by 41 percent Thursday to P0.24 on volume of 243.5 million shares valued at P58.91 million.

The stock market is rife with rumors that the Pangilinan-led group is conducting a due diligence on Lepanto, which is controlled by businessman-stockbroker Felipe Yap.

The STAR tried but failed to get a comment from Pangilinan as of presstime.

Hong Kong-based conglomerate First Pacific Co. Ltd., in which Pangilinan is managing director, is keen on expanding its presence in the Philippine mining sector as it continues to be on the lookout for other mining ventures aside from Philex Mining Corp.

First Pacific owns 22 percent of Philex, which owns and runs the Padcal mine, the only remaining gold-copper mine operating in the country.

Pangilinan earlier said First Pacific would use Philex as its main vehicle for mining investments in the country.

First Pacific also intends to raise its stake in Philex but this would depend on the financial requirements of the copper-gold producer and the approval of other shareholders including state pension fund Social Security System (SSS), the Ongpin bloc and the group led by former Philex chairman Walter Brown.

Lepanto, which operates the Victoria and Teresa gold deposits in Mankayan, Benguet, owns 60 percent of Far Southeast. It has 302 mining claims covering 4,168 hectares.

For this year, Lepanto expects its capital expenditures to reach P490 million, P296 million of which will go to development of mining projects. Another P136 million will be used to fund the acquisition of machinery and equipment while P27 million will go to the exploration of new mining areas.

Lepanto forecasts its tonnage production to improve from the present 1,200 tons per day to 1,500 tons per day.

On January 5, 2004, Lepanto was registered with the BOI as new export producer of copper-gold concentrate on a non-pioneer status for its project located also in Mankayan, Benguet,

Lepanto incurred a net loss of P46.63 million as sale of metals dropped to P371.5 million from P411.29 million.