Ejercito: MIC needs to buy Chinese equity out
The state fund managed by Maharlika Investment Corp. (MIC) should buy out State Grid Corporation of China’s 40 percent equity share in the National Grid Corporation of the Philippines (NGCP), Sen. Joseph Victor Ejercito said yesterday.
The senator was reacting to MIC’s announcement it has invested in a 20 percent stake in the National Grid through a binding agreement with Synergy Grid and Development Philippines Inc.
The investment move, nevertheless, is a welcome development for the MIC, Ejercito and other senators agreed.
“It is a sound investment for the Maharlika fund,” Ejercito said.
The P19.7 billion binding agreement with Synergy Grid represents 20 percent of the company’s preferred shares at an issue price of P15 per share, MIC President and Chief Executive Officer Rafael Consing Jr., said in a separate press briefing in Malacañang on Tuesday.
MIC’s move to buy 20 percent of preferred shares in Synergy Grid and Development Philippines Inc. is a welcome development for some senators as it would give the government representation in a key infrastructure.
“I was hoping that the 40 percent shares owned by the State Grid Corporation of China would be the one that will also be reacquired by the government for national security reasons,” Ejercito said.
He said the government should pursue taking back the 40 percent from the state grid “specially with the conflict with China in WPS (West Philippine Sea).”
“It should be prioritized,” he added.
Sen. Joel Villanueva said the MIC purchase into NGCP is expected to give the government greater influence and participation in the national grid, which should compel the power transmission company “to be more efficient” in carrying out its tasks.
“Greater efficiency and stricter compliance with government regulations will reduce transmission rates being charged by NGCP,” Villanueva said.
Sen. Juan Miguel Zubiri says the MIC deal is a “good investment in terms of profitability” since the National Grid “has no competition.”
“But more than just profitability, the investment in NGCP is strategic in terms of defense and security,” he said.
“The national government should be strategically involved in the control and management of such an important energy backbone of our country,” Zubiri added.
“I’m even in favor of crafting a bill where the strategic infrastructure of our country, which are of national security importance, should be 100 percent Filipino-owned and where the Maharlika fund should be more participative in as investors,” the senator said.
On the other hand, Sen. Sherwin Gatchalian said the move is a “collaborative step” in enhancing government participation in key infrastructures.
“This development highlights an opportunity for partnership between the private and public sectors to enhance transparency, improve oversight, and support the country’s energy sector,” he said.
“Moving forward, efforts must prioritize efficient management, accountability, and to ensure timely construction of transmission projects to provide adequate and affordable power for the Filipino people,” Gatchalian added.