Corporate News

Uy’s Phoenix Petroleum to buy LPG seller

Posted on May 25, 2017

PHOENIX Petroleum Philippines, Inc. is acquiring liquefied petroleum gas (LPG) seller Petronas Energy Philippines, Inc. (PEPI), the oil trader told the stock exchange on Wednesday.

In a disclosure to the stock exchange after trading hours, Phoenix Petroleum said its board approved the execution of a memorandum of understanding (MoU) with investment holding firm PDB (Netherlands) B.V. for the planned 100% share acquisition of PEPI.

PDB or Petronas Dagangan Berhad is the principal marketing unit of Malaysia’s national oil company Petroliam Nasional Berhad.

Phoenix Petroleum is also buying Duta, Inc., which manages and holds the various land parcels used by PEPI’s businesses.

A representative of Phoenix Petroleum did not immediately respond to a question on the total amount of the deal, but in its disclosure the company said the acquisition is subject to the approval of the Philippine Competition Commission (PCC).

Merger and acquisition deals in the Philippines valued at least P1 billion are subject to PCC review.

Phoenix Petroleum described PEPI as primarily engaged in the business of selling LPG in cylinders for household and commercial use, as well as LPG in bulk for industrial use and autogas, an alternative fuel for vehicles.

“The proposed acquisition of PEPI and Duta strategically supports the Company’s expansion in operation as well as product lines,” Phoenix Petroleum said.

The Davao-based company is engaged in the trading of refined petroleum products on wholesale and retail basis. It also operates gas stations, oil depots, storage facilities and related services.

Dennis A. Uy, Phoenix Petroleum president and CEO, earlier said the company was planning to spend between P6 billion and P8 billion in the next three year on top of the P2 billion it had set aside for 2017.

In 2016, Phoenix Petroleum posted a net income of P1.09 billion, higher by 21% compared with the earlier year’s bottom line, driven by fuel sales that expanded by double digits after “solid” growth in volume. -- Victor V. Saulon