The Philippine Competition Commission said Wednesday it approved the acquisition of shares by an American company in GNPower Kauswagan Ltd. Co., the builder and operator of a 552-megawatt coal-fired power plant in Lanao del Norte, from three subsidiaries of AC Energy Inc.
Proverbs 16 Inc. acquired indirect ownership of GNPower Kauswagan through the purchase of the shares in the three holding companies of AC Energy, namely BVI (Philco), ACE BVI (b) and ACE BVI (d).
The three subsidiaries hold a limited partnership interest in Kauswagan Power Holding Ltd. Co. which in turn has a limited partnership interest in GNPK.
GNPK is the operator of the 552-MW coal-fired power plant which is expected to be completed by the fourth quarter of 2019.
Following the completion of the transaction, AC Energy said it would exit from its investment in GNPK’s power plant.
Proverbs 16 currently holds interest in GNPK through Power Partners Ltd. Co. and GNPower Holdings GP Corp. Meanwhile, AC Energy Inc. is Ayala Group’s energy platform with renewable and conventional power assets and operations.
The anti-trust body said it issued the clearance after finding out that the said transaction would not likely result in a substantial lessening of competition in terms of power generation and sale of electricity in the relevant markets.
This is primarily due to competitive constraints exerted by other power plants in the Mindanao grid and the competitive pressure from other power providers nationwide when traded in the electricity spot market.
It said that with the acquisition resulting in added power portfolio by the acquiring firm, the transaction was not expected to significantly strengthen the ability or incentive of the parties to engage in foreclosure on customers or of its power supply.