Korea Electric Power Corp., the largest power company in South Korea, has canceled its bid to purchase the 40-percent stake of the BG Group of UK in two natural gas power plants in Batangas.
Kepco said in a regulatory filing that it withdrew its planned purchase after existing shareholders declined to approve the sale.
Kepco in September last year said it agreed to buy the BG Group’s 40-percent stake in the Sta. Rita and San Lorenzo natural gas power plants for $400 million. The two plants have a combined capacity of 1,500 megawatts.
First Philippine Holdings Corp. and First Gen Corp. of the Lopez group own 60-percent stake of the gas power plants.
First Gen president Francis Giles Puno said last week the Lopez group was interested in purchasing the BG Group’s stake in the gas power plants.
“[We are] still interested in acquiring it ourselves,” Puno told reporters, adding there were are no talks with the BG Group for any possible buyout “at this stage.”
“We’re just waiting. For the moment, unless we come into an agreement, we’ll just continue to have them as our partners and they’re amenable to that,” Puno said.
He said BG still considered its 40-percent stake in the gas projects good investments and it was not discounting the possibility of a “long-term” partnership with First Gen.
First Gen officials earlier said a possible partnership with Kepco was “not feasible” due to “conflict of interest.”
Puno said Kepco was a competitor in the natural gas business because it operates the 1,200-MW Ilijan combined cycle power plant in Batangas.
“The issue... is that [we are] in potential conflict with the likes of Kepco,” he said.
Puno said Kepco would learn more about First Gen’s future plans if it became the partner of the Lopez Group in the gas business.
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