PPA may intervene in MPIC-Harbour Centre row

MANILA, Philippines - The dispute between Metro Pacific Investments Corp. (MPIC) and the Romero family over control of the Manila North Harbor is still at a standstill and may require the intervention of the Philippine Ports Authority (PPA).

MPIC president Jose Ma. Lim said both parties are working towards the resolution of the issue at hand and are hoping an agreement will be reached in the next few weeks.

Lim said MPIC is waiting for the PPA’s action on the matter, pointing out that any change in ownership of Manila North Harbour Port Inc. (MNHPI), the joint venture between MPIC and the Romero-led Harbour Centre Port Terminal Inc. (HCPTI), would require the government’s approval. “We hope to set a meeting with them (PPA) soon,” he said.

The creation of a joint venture company was one of the requirements set by the PPA as part of the Manila North Harbor contract. MNHPI is currently 65 percent owned by the family of businessman Regis Romero with MPIC owning the balance of 35 percent.

Lim reiterated the group’s position that it would withdraw from the joint venture if it fails to secure majority control of MNHPI, which bagged the right to operate and manage the Manila North Harbor for 25 years with its bid of P14.5 billion.

“Only two options are viable for MPIC: secure majority ownership or failing this, full divestment. Majority control would give us confidence in committing the necessary capital to secure the equipment that will resolve the complaints of the shipping companies and fund the severance pay that is the source of current tensions with labor,” he said.

 Lim said the group will seek the return of all invested capital and the release of all guarantees provided by MPIC for the joint venture.

 “Securing control of MHNPI gives us confidence to ensure successful implementation and funding of the port’s modernization program,” he said.

The Philippine Lines Shipping Association Inc. (PLSA), made up of eight of the biggest users of the Manila North Harbor, has thrown its support behind MPIC in seeking control of the country’s busiest and premier domestic port.

In previous interviews, MNHPI president Michael Romero said his group was not inclined to cease control of the joint venture firm to MPIC, explaining that such a move would go against their commitment to modernize the aging North Harbor. The group is in the process of consolidating its port operations business under a new corporate entity to be called Harbour Centre Port Holdings Inc. in preparation for its planned initial public offering that could fetch proceeds of between P1.5 billion to P3 billion.

In a letter to the PPA, the PLSA, which contributes 70 percent of the domestic container market and 95-percent share of passenger volume at the harbor, said it believes that allowing Manuel V. Pangilinan’s group a majority stake in MNHPI will give MPIC the ability to reorganize MNHPI and have a professional management team run the port.

The turnover, originally slated for January, had been postponed several times due to strong opposition from ship liners, cargo handlers and labor groups.

The PLSA expressed concern over the prospect of the looming monopoly by the Romero family of three of the country’s ports – the North Harbor, the neighboring Harbor Center Port and the Subic Port.

To prevent further damage, the PLSA has urged the PPA to intervene in the rift between MPIC and the Romeros, saying their operations are “already badly affected by the inefficiency and lack of equipment of MNHPI.”

Manila North Harbor handles more than 85 percent of the domestic containerized and breakbulk cargo.