TransCo rejects NGCP IPO extension
Credit to Author: The Manila Times| Date: Thu, 04 Apr 2019 16:23:44 +0000
National Grid Corp. of the Philippines (NGCP) has no reason to continue delaying a mandated initial public offering (IPO), the National Transmission Co. (TransCo) chief said as firm defended its failure to list in the Philippine Stock Exchange.
In a Senate energy committee hearing on Wednesday, TransCo President and Chief Executive Officer Melvin Matibag said “we maintain that NGCP has no basis to ask for an extension for the period of 10 years because they have [had] a period of 10 years to comply.”
“I think the 10-year period is more than enough and probably the legislators have a reason why they put a period of 10 years,” Matibag added.
The NGCP is mandated under its 25-year concession agreement with the government to sell at least 20 percent of its outstanding capital stock within 10 years from the start of operations. The 10-year period has already lapsed the the firm last year asked the Energy Regulatory Commission (ERC) for an extension.
During the Senate hearing, an NGCP official said the firm was seeking a reasonable extension because market conditions were not suitable for an IPO.
“Consistent with the performance of its obligations under its franchise and the concession agreement, NGCP intends to comply with the requirement of listing of shares,” NGCP spokesperson Cynthia Alabanza said.
Other reasons for the delay, it added, are the absence of the final determination of price control arrangements from the ERC for the 2016-2020 regulatory period; pending disputes between NGCP,
TransCo and the Power Sector Assets and Liabilities Management Corp. that are now in arbitration; and public threats made by Matibag.
The TransCo chief said he was merely doing his job.
“I’ve been given a mandate by the President and by the Republic and by the people to protect the interest of the consumers in the country because my position was the transmission facilities is owned by the people,” he claimed.
It is in the best interests of Transco and NGCP to ensure that the listing proceeds, Matibag continued.
“Just imagine if we will be involved in a protracted litigation. Maybe by the end of the concession hindi na tayo nakapag-IPO (we would not have been able to stage the IPO),” he said.
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