ERC orders NGCP to undertake stock offering soonest

Updated May 7, 2020, 9:01 AM By Myrna M. Velasco
https://business.mb.com.ph/2020/05/06/erc-orders-ngcp-to-undertake-stock-offering-soonest/

Transmission firm National Grid Corporation of the Philippines (NGCP) has been directed by the Energy Regulatory Commission (ERC) to prepare and undertake its initial public offering (IPO) or stocks listing immediately; after its bid for extension was no longer allowed by the industry regulator.

In the ERC ruling, it was stipulated that “NGCP is directed to commence immediately the process of public listing pursuant to Republic Act 9511,” which is its franchise in operating the country’s power transmission assets.

On top of that, the regulatory body instructed NGCP “to submit a compliance report, showing its compliance with its public listing obligation within 30 days from the said compliance.”

Taking note of the ERC decision, Atty. Cynthia Alabanza, the spokesperson of the transmission firm said, “we are not avoiding an IPO, but we merely asked for a deferment of the offering to a more favorable time given the prevailing circumstances at the time of the petition.”

Nevertheless, she qualified that the company “fully respects the decision and jurisdiction of the ERC over the matter, and we intend to reply appropriately.”

And relative to the mandate of the regulator and its function as operator of the country’s power trans-mission network, NGCP indicated that it “always conducts its business in full compliance with the applicable laws, rules and regulations.”

The stock offering is one of the requirements under the company’s franchise, so the Filipino public could have leeway in gaining ownership of the transmission firm’s shares.

As emphasized, NGCP can undertake the listing and public offering subject to the requirements of the Securities and Exchange Commission (SEC) and the Philippine Stock Exchange (PSE) and must also be attuned to market conditions so value to shareholders can be guaranteed at the listing process.

The company previously sought for the deferment of its listing because of pending issues with government firms like the National Transmission Corporation and Power Sector Assets and Liabilities Management Corporation on concession fee payments; but that was just permitted initially for a one-year deferment.

NGCP is a private firm serving as concessionaire of the power transmission facilities and network of the Philippines; and its 25-year contract was won through a privatization undertaken by government in 2008 and subsequently awarded in 2009.