Maharlika eyes NGCP deal soon

EYES WIDE OPEN

- IRIS GONZALES

If Maharlika Investment Corp. (MIC), the country's first sovereign wealth fund, has its way, its investment in the National Grid Corp. of the Philippines could become a reality as early as January, the first month of the new year.

This is according to informed sources, who said that while there's no deal yet, Maharlika is already in advanced talks with NGCP shareholders. Ongoing discussions suggest it's likely to happen sooner than later, sources said.

It's no secret that Maharlika, and by default, the Marcos administration, wants to buy into NGCP, the private sector-led electricity superhighway operator.

Here's what I heard so far: The Chinese shareholder, State Grid Corp. of China, the state-owned power company of China, isn't budging and doesn't want to sell.

State Grid said the government has a contractual obligation to the NGCP consortium which in 2009 was awarded a 25-year contract to operate the country's transmission assets, as part of the overall privatization of the power industry. Listed Synergy Grid owns 60 percent of NGCP and the rest is owned by its technical partner State Grid.

The option for Maharlika now is to get NGCP to issue new shares to pave the way for the wealth fund's entry. This would dilute the rest of the existing shareholders - tycoons Henry Sy Jr. and Robert Coyiuto Jr.

A source said Maharlika is eyeing two board seats if possible, although Finance Secretary Ralph Recto, chairman of Maharlika, earlier said one seat would be enough, which he estimates to cost around P12 billion.

If the price is right All's fair in love and war but in business, it's all about the right price.