Investors pocket gains after Aboitiz group’s $1.5-B JERA deal

October 4, 2021 | 12:01 am

INVESTORS pocketed gains in Aboitiz Power Corp. last week after its parent holding firm announced the sale of up to 27% stake in its listed energy arm to Japan’s largest power generation company for nearly $1.5 billion.

A total of 49.88 million AboitizPower shares worth P1.59 billion were traded from Sept. 27 to Oct. 1, data from the Philippine Stock Exchange showed.

The share price of the Aboitiz group’s holding company for its energy-related businesses closed at P31.65 apiece on Friday, down by a peso or 3.1% from the P32.65 finish on Sept. 24. It has gained 17.2% since the start of the year.

“Investors took profit after the news came out of Aboitiz [Equity Ventures, Inc. (AEV)] selling 25% stake to Japan’s JERA [Co., Inc.],” Mercantile Securities Corp. Analyst Jeff Radley C. See said in an e-mail interview.

AEV approved on Sept. 27 the sale of a 25.01% stake in AboitizPower to JERA Asia Pte. Ltd., a wholly owned unit of Japan’s JERA Co.

The Aboitiz family’s privately held company also agreed to sell an additional 1.99% stake in the power holding firm.

Once done, JERA would own 27% of AboitizPower, while AEV will keep the majority at 52% from 77% previously.

The $1.463-billion deal is still subject to a slew of regulatory approvals, including those of stockholders in a special meeting on Dec. 9.

JERA — a joint venture between Japanese electric companies Tokyo Electric Power Group and Chubu Electric Power Group — is Japan’s largest power generation company and produces about 30% of its electricity.

It will also be working with AboitizPower for the latter’s clean energy projects, among others.

Following the announcement, AboitizPower shares dipped by 9.6% and 3.6% on Tuesday and Wednesday, respectively, to P30.90 and P29.80 from P34.20-per-share finish on Monday.

This prompted AEV to reassure investors on Tuesday that the JERA deal will be used to bankroll other Aboitiz businesses or to refinance existing debt. It will also bring in “a very strong partner” for AboitizPower.

“Long term, this will bode well for Aboitiz group since it can get some expertise or know-how from Japan’s JERA in the power-generation sector,” Mercantile Securities’ Mr. See said.

“With the transaction, Japan’s JERA Co. may contribute to optimize the resources of [AboitizPower] to build the almost 4,000 MW (megawatts) of renewable energy within in 10 years through technology transfer attune to the times…,” Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said in a text message.

AboitizPower is looking to build about 3,900 MW of renewable energy in the next 10 years, bringing its portfolio to 9,200 MW, to achieve a 50:50 renewables and thermal capacity mix.

In the first semester, its attributable net income grew by 2.7 times to P10.13 billion from P3.74 billion a year ago.

Mr. Pangan sees AboitizPower’s bottom line to grow by double-digits to about P20 billion by yearend.

“For [the third quarter], though restrictions are longer due to the Delta variant but with better mobility, we may continue to see sustained growth in its bottom line with better [Wholesale Electricity Spot Market] prices as compared to last year, better hydroelectric performance on higher water levels, and commissioning of GNPower Dinginin Unit 1 at 668-MW rated capacity in the [second quarter],” he said.

This week, Mr. See expects AboitizPower to move sideways between P30 and P35 a share.

Mr. Pangan gave his support and resistance at P29.60 and P35.10, respectively.

“[This] week, we may continue to see rebound in the price of AboitizPower after the profit taking [last] week due to a volatile market,” he said. — Bernadette Therese M. Gadon

Analysts’ September 2021 inflation rate estimates

October 4, 2021 | 12:00 am

INFLATION likely quickened beyond the central bank’s target in September, as prices of food and utilities continued to surge, according to analysts. Read the full story.

How PSEi member stocks performed — October 1, 2021

October 4, 2021 | 12:00 am

Here’s a quick glance at how PSEi stocks fared on Friday, October 1, 2021.

Duterte says daughter to run for President in 2022

October 3, 2021 | 7:47 pm

Sara_Duterte — DAVAO City Mayor Sara Duterte-Carpio

By Kyle Aristophere T. Atienza, Reporter

PRESIDENT Rodrigo R. Duterte on Saturday said his daughter Sara would run for President next year.

Sara Duterte-Carpio, who is mayor of their hometown Davao City, will run in tandem with Senator Christopher Lawrence T. Go, the President’s former aide, the tough-talking leader told a local broadcast journalist.

“It will be a Sara-Go [tandem],” Mr. Duterte said in Filipino outside a hotel near Manila, the Philippine capital, where Mr. Go filed his certificate of candidacy for vice-president.

“No comment,” Ms. Carpio said in a mobile phone message on Sunday. She filed her certificate of candidacy for a third term as mayor at the weekend.

Mr. Duterte, who had flip-flopped on his 2016 presidential run, earlier said he would drop out of the vice-presidential race if his daughter runs for President.

A Social Weather Stations poll in June showed that six of 10 Filipinos thought Mr. Duterte’s vice-presidential run would be illegal.

Ms. Carpio, whose regional party has allied itself with traditional parties less than a year before the 2022 elections, has topped presidential opinion polls.

Asked when his daughter would file her candidacy for President, Mr. Duterte said: “I do not have any idea at all.” “We don’t talk about politics. I would say that it is for the better,” he added.

The Duterte camp’s political move is part of a plan to create a public clamor for Ms. Carpio’s presidential candidacy, said Jean Encinas-Franco, a political science professor at the University of the Philippines (UP).

“It may not be a reluctance but a strategy,” she said in a Facebook Messenger chat. “The potential opponents are uncertain of who they are up against and they also find it difficult to look for a good pair of President and vice president,” she said. “The Dutertes are also shaping the media narrative.”

Ms. Carpio seemed reluctant to run for the country’s top post because she does not want to expose her family to public scrutiny, said Maria Ela L. Atienza, who also teaches political science at UP.

“Maybe, the reluctance is just for show and part of their overall political tactic to surprise competitors,” she said in a Viber message. “Remember that President Duterte also said he was retiring from politics in 2015, but then replaced Martin Diño as a presidential candidate.”

Ms. Atienza said the ruling camp might be doing everything they can to protect Mr. Duterte from potential lawsuits.

“It seems there is pressure for the daughter to run to protect her father from possible cases here and the International Criminal Court (ICC),” she said.

The ICC has ordered an investigation of Mr. Duterte’s crackdown on illegal drugs that has killed thousands, saying crimes against humanity might have been committed.

The court will also probe vigilante-style killings in Davao City when Mr. Duterte was still its vice mayor and mayor.

There have been speculations that the Dutertes would consider ex-Senator Ferdinand “Bongbong” R. Marcos, Jr., the late dictator’s son, as either a presidential or vice-presidential candidate.

Political analysts have said Mr. Duterte could not afford to lose support from the Marcoses because their loyal backers supported his presidential candidacy in 2016.

A recent Pulse Asia Research poll showed that Ms. Carpio and Mr. Marcos were among the top choices for president.

Politicians have until Oct. 8 to file their certificates of candidacy. Substitutions are allowed until mid-November.

COVID-19 situation in metro and 8 other regions better, says OCTA

October 3, 2021 | 7:46 pm

Church-vaccination — PHILIPPINE STAR/ MICHAEL VARCAS

CORONAVIRUS infections in the capital region and other key economic hubs have been decreasing, according to researchers from the country’s premier university.

Cases in the National Capital Region (NCR) and eight other provinces were on a “downward trend,” OCTA Research Group fellow Fredegusto P. David tweeted on Sunday.

The so-called NCR Plus 8 is composed of Metro Manila, Bulacan, Pampanga, Cavite, Rizal, Laguna, Batangas, Cebu City and Davao City.

Mr. David said Metro Manila’s coronavirus reproduction number was 0.83, which is lower than the critical cut-off of 1.4

NCR Plus 8 areas had reproduction numbers below the critical level, he said, citing government data.

Cavite had the lowest reproduction number at 0.63, followed by Cebu City at 0.66, Laguna at 0.68, Bulacan at 0.7, Batangas at 0.74, Pampanga and Rizal at 0.85 each and Davao City at 0.89, Mr. David said.

Still, the infection rates in all NCR Plus 8 areas except Cebu City were within the high risk level, he added. — Kyle Aristophere T. Atienza

EC says it’s watching human rights situation

October 3, 2021 | 7:45 pm

THE EUROPEAN Commission is closely monitoring political developments in the Philippines after flagging “serious concerns” about the country’s human rights situation, according to a spokesman.

The body is engaging with the Philippines through political and technical dialogue backed by “rigorous analysis” of the situation on the ground, the spokesman, who asked not to be named, said in an e-mail.

The European Parliament last year asked the commission to start the process of withdrawing trade incentives from the Philippines after the government failed to improve the human rights situation.

More than 6,000 Philippine products enjoy zero-tariff entry to the European Union (EU) as long as the country complies with 27 core international conventions that include human and labor rights, environmental protection and good governance.

The commission earlier raised “serious concerns” with President Rodrigo R. Duterte’s war on drugs that has killed thousands and his attacks on human rights leaders.

“We are also using the Generalized Scheme of Preferences Plus (GSP+) monitoring process to raise these issues with the authorities of the Philippines and seek compliance with its international commitments under GSP+,” the spokesman said. “This is an ongoing process.”

The temporary withdrawal of GSP+ privileges could be done as a last resort if all other options fail, the spokesman said.

The Trade department has said the Philippines would likely keep the tariff perks. Trade Undersecretary Ceferino S. Rodolfo earlier told a business forum the agency had submitted its responses to the 2021 EU GSP+ monitoring questionnaire.

“‘The Philippines remain to be engaged at the technical level with respect to the monitoring of our compliance with the EU GSP+ commitments,” he said.

The potential loss of tariff advantages offered by the EU could harm crude coconut oil, canned tuna and garment exports, business leaders have said.

Goods exported under GSP+ preferences accounted for about a quarter of total Philippine exports to the EU in 2018. Philippine use of GSP+ compared with all eligible exports was 73.1%.

The International Criminal Court last month ordered an investigation of Mr. Duterte’s drug war, finding “reasonable basis” that crimes against humanity had been committed.

The European Union (EU) Parliament earlier adopted a resolution urging the Philippines to free Senator Leila M. de Lima, whom the Duterte government is trying for drug trafficking, and look at extrajudicial killings in connection with the drug war.

The EU lawmakers also asked the European Commission to revoke tax perks enjoyed by the country if the government fails to address human rights violations.

The local Anti-Money Laundering Council earlier said investigators had found no money flowed from the bank accounts of the senator and her co-accused.

Ms. De Lima has been in jail since Feb. 2017. Several witnesses against her were drug convicts serving time at the national penitentiary in Muntinlupa City. — Jenina P. Ibañez

Business groups, universities urge gov’t officials’ cooperation on Pharmally probe

October 3, 2021 | 7:44 pm

face-shield-mask — PHILIPPINE STAR/ MICHAEL VARCAS

SEVEN BUSINESS GROUPS and six universities called on the national government to cooperate in the investigation on questionable purchases of pandemic supplies after a Pharmally Pharmaceutical executive was placed under the protective custody of the House of Representatives.

“The allegations, testimonies, and documents provided regarding the use of public funds meant to acquire items to minimize the threat to the lives of our citizens occasioned by the pandemic are very sobering. If true, the context would make the wrongdoing particularly onerous and deserving of the full force of sanctions on its perpetrators that our justice system provides,” they said in a joint statement on Sunday.

The groups also called on all parties, especially lawmakers and executive officials, to conduct their investigations on the purchases made between the government and Pharmally with “integrity, transparency, and respect, and in compliance with (existing) laws.”

“Our frontliners and the Filipino people deserve a full and fair accounting. As well, the pursuit of good governance is a pillar of the just, inclusive, and functioning society we aspire to.”

The statement was signed by the following: Bishops-Businessmen’s Conference, Financial Executives Institute of the Philippines, Investment Houses Association of the Philippines, Judicial Reform Initiative, Management Association of the Philippines, Makati Business Club, Shareholders Association of the Philippines, Ateneo de Manila University, Ateneo de Naga University, Ateneo de Zamboanga University, Xavier University-Ateneo de Cagayan, De La Salle University, and De La Salle Philippines.

The statement comes after Pharmally executive Krizle Grace Mago voluntarily placed herself under the protective custody of the House of Representatives to “help (her) speak freely without unnecessary compulsion.”

Days prior, she could not be contacted by the Senate Blue Ribbon Committee following her revelation that certificates of some two million face shields that expired last year were changed to 2021.

Senator Richard J. Gordon, Sr. said in a DZBB interview Sunday that he hoped that the House’s custody of Ms. Mago will not hamper their investigations.

President Rodrigo R. Duterte said Friday evening that he would formally bar Cabinet members such as Health Secretary Francisco T. Duque III from testifying in the Senate probe on the Pharmally purchases.

House lawmakers are set to continue their investigation on Monday while the Senate resumes its probe on Tuesday. — Russell Louis C. Ku

DoJ sees criminal liability of police in drug war cases

October 3, 2021 | 7:42 pm

JUSTICE SECRETARY Menardo I. Guevarra said 154 policemen involved in the 52 drug war cases turned over by the national police in June to the Justice department will possibly face criminal charges and not just administrative liability.

“The DoJ (Department of Justice) noted that based on the facts gathered by the Philippine National Police (PNP) Internal Affairs Service, the police officers involved in these cases were not only administratively liable; the existing evidence pointed to their possible criminal liability as well,” Mr. Guevarra told reporters in a Viber group message on Sunday.

He added that the 52 cases, which took four months of review, will be endorsed to the National Bureau of Investigation (NBI) for case build-up, if deemed necessary, and it can file the criminal complaints directly afterwards.

Of the 52 cases, Mr. Guevarra said one is not drug war-related and one does not involve death, but all cases will still be endorsed to the NBI.

Mr. Guevarra further said that the DoJ and the NBI “will cooperate in future investigations on similar instances so that criminal and administrative liability will simultaneously be determined.”

He said the report itself cannot be released yet to the public as it “is a confidential memo for the President, but we are informing the public of its contents.”

The Justice department will also discuss with the Commission on Human Rights if it should be involved in the next phase of the work of the drug review panel.

While waiting for the NBI’s action, Mr. Guevarra said the DoJ will focus on the nearly 100 cases connected to the drug war filed in courts nationwide.

In his speech on Sept. 21 at the 76^th United Nations General Assembly, President Rodrigo R. Duterte directed the DoJ and the PNP to strengthen their review of drug war-related deaths.

Mr. Duterte also said that “(t)hose found to have acted beyond bounds during operations shall be made accountable before our laws.”

Human rights lawyer Neri J. Colmenares, in a telephone interview on Sept. 16, said the Duterte administration is “fooling the people to file drug war-related cases in local courts because the President has immunity here” over lawsuits.

Mr. Colmenares also said that many human rights lawyers think that the government investigation is “not genuine because it took place only five years after the extrajudicial killings started.”

About 6,100 suspected drug dealers and users have been killed since Mr. Duterte took office in June 2016, according to government data. On the other hand, the UN Human Rights Watch said in its World Report 2021 that its Office of the High Commissioner for Human Rights put the death toll from the Philippine drug war at 8,663. Other human rights groups, including the Commission on Human Rights, believe that the real figure is around 30,000. — Bianca Angelica D. Añago

Health coalition calls on gov’t to back waiver on IPR for COVID vaccines

October 3, 2021 | 7:41 pm

sinovac-vaccine — PHILIPPINE STAR/ MICHAEL VARCAS

A COALITION on health rights on Sunday urged the Philippine government to back international calls for the waiving of intellectual property rights for coronavirus vaccines.

“Government pronouncements have highlighted the lack of vaccine supply, yet does not acknowledge the question of inequity on an international scale — one that the TRIPS (Trade-Related Aspects of Intellectual Property Rights ) waiver dares to answer by providing more opportunities to manufacture and produce vaccines outside the profit-oriented pharmaceutical monopolies,” the Coalition for People’s Right to Health (CPRH) said in a statement.

Mr. Duterte has criticized wealthy nations for hoarding coronavirus vaccines while poor countries struggle to secure shots for their population.

“Rich countries hoard life-saving vaccines while poor nations wait for trickles,” he said in a taped speech to the 193-member United Nations General Assembly last month.

The tough-talking leader has also accused the European Union of holding up vaccine supplies from other countries, citing the economic bloc’s export rule that requires drug makers to obtain permission first before shipping vaccines outside the region.

The CPRH said Philippine authorities have failed to pressure the World Trade Organization to waive the patents for coronavirus disease 2019 (COVID-19) vaccines, medicines, and technologies that will prevent, treat, and contain the pandemic.

Instead of transparently addressing the inequitable distribution of vaccines, “no coherent position on the proposal at the WTO has been put forward,” it said. — Kyle Aristophere T. Atienza

BSP calls for law punishing hoarding after seizure of P50M in 1-peso coins

October 3, 2021 | 7:41 pm

Coins-hoarding — NBI, Customs bureau and the Bangko Sentral ng Pilipinas raid a warehouse in Quezon City after reports of P50 million worth of coins and P100 million worth of undocumented imported luxury cars are stored in the area. — PHILIPPINE STAR/ MICHAEL VARCAS

THE CENTRAL bank is pushing for legislation against coin hoarding following the recent seizure of P50 million worth of coins in Quezon City.

“The Bangko Sentral ng Pilipinas (BSP) is advocating the passage of a law on the hoarding of an extremely large volume of coins, as the central bank believes that the criminalization of this activity reinforces continuing efforts to maintain and protect the integrity of Philippine currency,” it said in a statement on Sunday.

“Coin hoarding results in the inefficient circulation of coins and prevents their primary use as medium of exchange. It hampers the efficient flow of transactions and causes an artificial shortage, which is disruptive to the financial system,” it added.

The National Bureau of Investigation, in partnership with the Bureau of Customs, the Philippine Coast Guard, and the BSP, seized a stockpile of P1 coins amounting to about P50 million from a warehouse on Oct. 1.

Samples from the pile are still being tested by the central bank to gauge their authenticity. The central bank said the coins are from various design series.

“Under its Coin Recirculation Program, the BSP encourages the public to refrain from unnecessarily accumulating coins, and instead use them to pay for goods and services or deposit them in banks,” the BSP said.

The central bank released new designs for coins in 2018. The following year, an enhanced version of the P5 coin was introduced to make it easier to distinguish from the P10 coin. — Luz Wendy T. Noble

Samal-Davao bridge project still under loan negotiation with China, right-of-way proceedings

October 3, 2021 | 7:40 pm

START of construction for the Samal-Davao bridge project remains uncertain as loan negotiations with the Chinese government are still ongoing and right-of-way acquisition is still in the assessment stage, a regional official said last week.

Maria Lourdes D. Lim, National Economic and Development Authority-Davao regional director, said the Department of Finance submitted an updated loan application last April 26, reflecting a revised financing ratio of 90% loan and 10% local fund.

The application was submitted to the China International Development Cooperation Agency (CIDCA) and China Eximbank.

“It is in the procurement process because it involves foreign contractors and since this is funded by a loan from China, there will be a process of selection for contractors that will pursue the implementation of this project,” Ms. Lim said during the virtual Regional Development Council Week forum.

In January this year, the Department of Public Works and Highways (DPWH) signed a P19.32-billion contract with a Chinese firm for the design and construction of the 3.98-kilometer bridge project that will connect Samal Island to the Mindanao mainland via Davao City.

China Road and Bridge Corp. bagged the design-and-build contract for the project following procurement activities in Nov. and Dec. 2020, the department said in a statement on Jan. 14.

“With the signed contract, we can now apply for the loan agreement with the People’s Republic of China through China International Development Cooperation Agency to proceed with the detailed engineering design,” Public Works Secretary Mark A. Villar was quoted as saying.

Undersecretary Emil Sadain, officer-in-charge of the DPWH Unified Project Management Office, said the Finance department’s revised loan application is just a matter of “being circumspect” on the project.

“Negotiation is a process. Ongoing pa rin ang negotiation nila, government to government,” Mr. Sadain told Businessworld.

Meanwhile, Ms. Lim also said preparatory activities for right-of-way acquisition are underway with the revised parcellary plan still in the works as of June 25.

“This parcellary plan will be the technical basis to give a headstart to the procurement of the government counterpart and to expedite the right of way and resettlement action plan for the implementation of this project,” she said.

Distribution of notices of acquisition to affected landowners and property appraisals in Davao City are also in progress, she said.

On the groundbreaking ceremony that was expected earlier this year, Ms. Lim said, “Let us just wait for the announcement from DPWH, but right now we can say this (project) is still on stream.” — Maya M. Padillo

Ruling party row: Pacquiao expelled by Duterte group; Pimentel dismisses pronouncement

October 3, 2021 | 7:40 pm

Pacquiao-Atienza — SENATOR MANNY PACQUIAO FB PAGE

THE RULING PDP-Laban party under President Rodrigo R. Duterte on Sunday announced that Senator Emmanuel “Manny” D. Pacquiao has been automatically expelled for filing his certificate for presidential candidacy under a different party, but the other faction led by the party founder’s son dismissed the pronouncement.

Mr. Pacquiao on Friday filed his candidacy under the Progressive Movement for the Devolution of Initiatives (PROMDI), noting the party’s alliance with PDP-Laban and the People’s Champ Movement, a coalition he called the “MP3.”

PDP-Laban Secretary General Melvin Matibag under the Duterte camp said the party’s constitution states that the filing by a member of a certificate of candidacy under another political party is grounds for automatic expulsion. “If that is not disloyalty, betrayal, and abandonment of PDP Laban, I don’t know what is.”

Senator Aquilino “Koko” L. Pimentel III, chairman of the opposing group, denied the claim, saying that a resolution was made that allowed Mr. Pacquiao to use PROMDI in order to consolidate his support base and alliance partners.

“The ‘issue’ being propagated by (Energy Secretary Alfonso G.) Cusi and Matibag is a figment of their imagination which they want to use for their own political propaganda,” said Mr. Pimentel via Viber.

The legitimate PDP-Laban group will be decided upon by the Commission on Elections. — Alyssa Nicole O. Tan