K-Water inclined to accept Angat Sale’s Certificate of Effectivity

Manila Bulletin 
By Myrna M. Velasco 
Published: July 23, 2013 
While the conditions to transaction closing are being sorted out, buyer Korea Water Resources Corporation (K-Water) reportedly indicated to the Philippine government that it is inclined “to accept” the certificate of effectivity (COE) that will be issued for the privatized 218-megawatt Angat hydropower facility.
This then signaled asset-seller Power Sector Assets and Liabilities Management Corporation (PSALM) to finally issue the COE that will finally seal the deal for the Angat plant’s divestment.
PSALM president Emmanuel R. Ledesma Jr. disclosed that “the parties are coordinating with a view to issuance of the COE as soon as possible.”
From the issuance of the COE, K-Water will have to put up the upfront payment for the asset, which will be equivalent to 40-percent of its winning bid of $440.88 million.
The Korean firm earlier indicated that it will have to accomplish that within 27 days from the time that the COE was served.
Although it appears that the Angat deal is already inching close to a positive finish, it was disclosed by parties that the conditions lodged by K-Water for the closing remained and yet to be resolved by relevant government agencies.
It was noted that the balance of power seem tilted into K-Water’s favor, with the government flexing all muscles to satisfy the buyer’s conditions but without necessarily violating laws or other policies.
An official of K-Water, according to sources, went up to the extent of confronting one of the government officials by saying that “why the Philippine is not coordinating with us” – done in not-so-cordial tone.
K-Water reportedly feels that it has the upper hand in this transaction closing because the Philippine government has been voicing out its need for the payment for the facility.
That was in spite of the Department of Finance (DOF) reportedly relaying to Energy Secretary Carlos Jericho Petilla that the government is already on the safe side financially even without the proceeds from the Angat asset.   source