MVP group seals crucial Meralco pact

By Paolo Montecillo

Philippine Daily Inquirer

PHILIPPINE LONG DISTANCE Telephone Co. has finalized a deal with First Philippine Holdings Corp. (FPH) that will block any outside attempt to take over the country’s largest power distributor Manila Electric Co. (Meralco).

FPH of the Lopezes, together with companies identified with businessman Manuel V. Pangilinan—PLDT, Pilipino Telephone Corp. (Piltel) and Metro Pacific Investments Corp. (MPIC)—on Monday said they had finalized on Nov. 20 an agreement that would bar the sale of FPH shares in Meralco to parties other than those belonging to the PLDT bloc for three years.

Under the agreement, some shares may be sold to others as long as the sale will not exceed:

A total of five million shares during the period January 1 to June 30, 2011;

Five million shares from July 1 to Dec. 31, 2011; and,

Twenty million from July 1, 2012 until the end of the three-year “standstill” period.

But before any of the shares are sold, the agreement grants FPH the right of first offer to sell the shares to MPIC or Piltel at the same price, under the deal’s “right of first refusal” clause. Read More...