NEGOTIATIONS between Metro Pacific Investment Corp. and First Philippine Holdings of the Lopez Group are now ongoing for the 6.7 percent stake in Manila Electric Company (Meralco).

Manny Pangilinan, chairman of Metro Pacific, said they offered P90 per share for the 6.7 percent stake.

For updates from around the country, follow Sun.Star on Twitter

"We expect those discussions to finish shortly," Pangilinan told reporters. "What Mr. Lopez mentioned is a possible investment in half of their equities. That is correct. That is the area of discussion."

He added that the indicative price for Meralco's 6.7 percent stake is higher than the 20 percent.

Pilipino Telephone Corp., a subsidiary of Philippine Long Distance Telephone Co., earlier acquire 223 million common shares of Meralco at a price of P90 a share equivalent to P20.07 billion for a 20 percent stake in the power distribution firm.

To recall, Metro Pacific concluded this month its purchase of 13 percent of Meralco from the Beneficial Trust Fund, the retirement fund of PLDT and New Gallant Limited.

Metro Pacific previously acquired 1.7 percent additional shares in the open market bringing its total shares to 14.7 percent.

It has investments in toll road, water utility, and hospitals.

Pangilinan declined to comment whether Metro Pacific's latest acquisition would trigger a tender offer but said they may seek an exemption from the tender offer rule of the Securities and Exchange Commission.

For his part, Meralco chairman Manuel Lopez said the sale to Metro Pacific is the decision of First Holdings.

"I guess First Holdings would like to address some of their debt obligations at the same time take advantage of the favorable price, that must be their reason, but the more compelling reason must be to address their maturing debts," Lopez said.

He said the entry of PLDT provided a lot of value-added to Meralco. "A lot of initiatives are being worked out now. So at the end of the day it's going to be a very dynamic relationship."

First Holdings chairman Oscar Lopez meanwhile said the decision not to sell right away the 6.7 percent is primarily to "wait for better prices later."

He said PLDT and Metro Pacific have the "right of first refusal" over First Holdings' remaining stake in Meralco, thus they cannot sell their shares to San Miguel Corp., another major shareholder of Meralco.

For Lopez, the best time to sell the remaining 6.7 percent is in the next two to three years. (MSN/Sunnex)