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Fresh funds seen to boost Converge’s expansion efforts

By Denise A. Valdez, Reporter

CONVERGE ICT Solutions, Inc. is seen to become a “more formidable player” in the fixed broadband segment, after the company received fresh funds from a United States-based private equity firm, according to an economic research firm.

In a report released on Tuesday, Fitch Solutions Macro Research said Converge has the potential to grow its business as it recently secured $250.4 million in fresh funds from Warburg Pincus.

Fitch Solutions said Converge is expected to allocate the funds for the expansion of its fibre optic infrastructure. But it added Converge could also consider moving into reselling mobile services to revive its intention of becoming a major telecommunications player in the country.

“While fixed broadband will initially be the focus for Converge, the company could move into reselling mobile services,” Fitch Solutions said. “To become a more comprehensive competitor in the consumer space, Converge could look to launch mobile services through a mobile virtual network operator (MVNO) agreement with another operator.”

Converge had planned to participate in the government’s auction for a new major telecommunications player last year, joined by KT Corp. and Teltech Group, but eventually backed out due to the performance and financial conditions required from the bidders.

Fitch Solutions noted Converge is currently lagging behind incumbents PLDT, Inc. and Globe Telecom, Inc. in terms of broadband subscriber count, as it reported last year that its base was at 200,000, trailing both PLDT at 2 million and Globe at 1.6 million subscribers.

The research firm said it sees that Converge will eventually “seek to further monetize its fiber backbone further by leasing capacity to other operators.”

“Converge already offers ICT services for small-to-medium enterprises (SMEs) and larger corporates, providing wholesale, colocation and leased line services, among others,” it said.

But it noted the company’s expansion is hounded by the government’s “slow pace of regulatory reform,” suggesting legislative challenges in infrastructure rollout will be the biggest threat to Converge’s success.

“The process of deploying fiber optic cable requires several local government entities to issue up to 27 permits as part of a process which could take several months or years,” Fitch Solutions said.

“While government efforts…will be positive at simplifying the application process for telecoms companies seeking right of way to rollout their infrastructure…the unrushed pace at which new law is passed in the country will continue to be a hurdle.”

It noted while several initiatives are already in place to skirt around the bureaucracy and form “one-stop shops” for regulatory requirements, these are still yet to materialze, delaying further the growth potential of telecommunications companies.

“For one, the Open Access In Data Transmission Act which was introduced in the Senate in March 2018 to remove requirements for companies to enter the data transmission business has yet to be approved by lawmakers,” Fitch Solutions cited.

Converge is targeting to reach 7 million subscribers in four years with a five-year, $1.8-billion investment for its nationwide fiber rollout, together with partners KT Corp. from South Korea, Tyco Electronics Subsea Communications LLC (TE SubCom) from US and Filipino-Korean venture LSI-Fibernet Konstrukt Corp.

Former DFA chief Del Rosario resigns from First Pacific board

FORMER Department of Foreign Affairs (DFA) Secretary Albert F. del Rosario has resigned as non-executive director of Hong Kong-listed First Pacific Co. Ltd., citing poor health and his decision to focus on personal advocacies.

This comes less than two weeks after Mr. Del Rosario was denied entry to Hong Kong, which caused him to miss First Pacific’s board meeting and shareholders’ meeting on June 21.

In a disclosure posted on the Hong Kong Stock Exchange on Tuesday, First Pacific said that Mr. Del Rosario has tendered his resignation on July 1.

Salim-led First Pacific controls three Philippine firms, namely Metro Pacific Investments Corp., PLDT, Inc., and Philex Mining Corp.

Mr. Del Rosario, who turns 80 in November, attributed his decision to leave the company to “poor health” and “other constraints, such as, his increased involvement in a number of personal advocacies which makes it difficult for him to continue to serve as a director of the company.”

The company noted that Mr. Del Rosario does not have any disagreements with the board of directors, and that he has no claims over fees, remuneration or compensation, or loss of office.

“The board would like to express its profound thanks to Ambassador del Rosario, who has been a source of invaluable counsel to the company during his tenure,” First Pacific said.

On June 21, the country’s former top diplomat was held and questioned by immigration officers at the Hong Kong International Airport, before being deported back to Manila.

At that time, Mr. Del Rosario called Hong Kong’s denial of entry despite his diplomatic passport a “disrespectful act” of the special administrative region of China against the Philippines.

Mr. Del Rosario and retired Ombudsman Conchita Carpio-Morales sent a “communication” to the International Criminal Court (ICC) last March asking the organization to conduct a preliminary examination against Chinese President Xi Jinping and other officials in connection with the harassment of Filipino fishermen in the West Philippine Sea.

Mr. Del Rosario first sat on First Pacific’s board in June 2003 as independent non executive director. He left the board after being appointed as Secretary of the Department of Foreign Affairs from February 2011 to March 2016 by former President Benigno S. Aquino III. He returned to First Pacific on June 2016, occupying the same post.

He also served as the Philippine Ambassador to the United States from 2001 to 2006 under then President Gloria Macapagal-Arroyo.

First Pacific now has nine members, namely, non-executive chairman Anthoni Salim, managing director and CEO Manuel V. Pangilinan, chief financial officer Christopher H. Young, Benny S. Santoso, Tedy Djuhar, Edward K.Y. Chen, Margaret Leung Ko May Yee, Philip Fan Yan Hok, and Madeleine Lee Suh Shin.

Hastings Holdings, Inc. — a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc. — maintains interest in BusinessWorld through the Philippine Star Group, which it controls. — Arra B. Francia

Widus International expands deal with AboitizPower

ABOITIZ Power Co. said on Wednesday that it had signed up Widus International Leisure, Inc. to switch to its Cleanergy brand.

In a disclosure to the stock exchange, the company said the owner and operator of the hotel and casino tapped AboitizPower for a 2.5-megawatt (MW) energy requirement, which is an expansion of its previous 1.5-MW supply deal.

“There are a lot of energy companies in the Philippines, so we are really honored to be the preferred partner of Widus in its journey toward sustainability. With AboitizPower’s proven track record in the industry, as well as adequate capacity of Cleanergy, we are confident that we will be able to support the current and future energy needs of Widus,” said Emmanuel V. Rubio, AboitizPower chief operating officer.

The energy supply is being sourced from one of the energy company’s renewable plants, the MakBan geothermal power plant that straddles the provinces of Batangas and Laguna.

The partnership was established in 2018 when the premier leisure destination at Clark Freeport Zone in Pampanga made the switch to the listed company’s brand of clean and renewable energy.

AboitizPower quoted Neki A. Liwanag, WILI assistant vice-president for corporate planning and compliance, as saying: “As a thriving metropolis, Clark is teeming with exciting activities and places of interest. Since it opened in 2008, Widus has become a leading destination for its topnotch facilities and world-class entertainment offerings. But apart from being known for our signature warmth and hospitality, we are proud to be a company that values sustainability.”

AboitizPower said Widus signed a power supply agreement under the retail competition and open access (RCOA) scheme, which allows businesses and institutions with a monthly average peak demand of 750 kilowatts to source their energy supply from a retail electricity supplier.

“In the retail electricity market, customers are given the opportunity to choose the supplier and rate that will allow for savings and security from market volatility,” it said.

AboitizPower and its partners have around 1,200 MW of Cleanergy capacity from its hydro, geothermal, and solar power plants all over the country. — Victor V. Saulon

Milky Way stays true to its roots

HOME COOKING has a way of connecting us with a purer version of ourselves. Before the world left us all scratched, somebody loved us and prepared food for us. We guess that’s the magic of Milky Way Café, where each dish brings us back to our mother’s table, when nothing yet could go wrong.

It’s not just our memories that Milky Way Café taps into, but the collective memory of the nation. The restaurant has been around since 1962, and many people have fond memories of the era: before the smog, before the skyscrapers, before the traffic; before everything that had come to pass since then.

Chef J Gamboa, son of Milky Way founder Julie Araullo Gamboa, talked with BusinessWorld earlier this week in the newly renovated Milky Way branch in Rockwell, the second; the first being the bigger Milky Way in Makati’s Arnaiz Ave. (though some still call it by its former name, Pasay Road). The restaurant’s concept is even older than he is: he was born in the purple of his parents’ success in 1971, almost a decade after they first opened Milky Way Turo-Turo (literally point-point, which means cafeteria-style service) across Malacañang. Educated in the US, he and his siblings have since expanded into Spanish, Thai, and Japanese cuisines, all the restaurants located beside the Arnaiz Ave. branch.

At its peak, his mother had 15 Milky Way branches across Metro Manila. Now, there are only two, while his cousins have branches that share the brand name, but not exactly the same fare. See, the restaurant started as an ice cream factory that was bought by his grandfather from two Spanish ladies who opened it up immediately after the war. His grandfather gave his eight children permission to open up their own independent restaurants, with the condition that none of them would go into business together. So at some point in time, there were several Milky Way Cafés owned and operated independently by various Araullo siblings. Mr. Gamboa says that the only thing they all have in common now is the ice cream, which they provide for everyone.

Mr. Araullo said that his favorite dish is their ox-tongue asado, stewed in tomato sauce, leaving a cut of meat that is almost buttery-soft. Other selections include the Bistek Tagalog (beef cooked in soy sauce and onions) and the Kare-kare (meat and vegetables stewed in a peanut-based sauce) which one might argue appears on all tables in the Philippines anyway.

So why do people come to them for food that’s accessible to nearly everyone? He gave the example of their Crispy Hito (catfish), which they would have at least once a week at his late mother’s house. “We kind of taught people how to eat it.” A few years ago, a lady who was a loyal customer approached him, praised him for the fish, but balked at the prices, declaring that she could make it cheaper at home. Mr. Gamboa taught this lady, whom he fondly called one of his titas, how to make it the Milky Way way. She came back and said that she failed in replicating the recipe, and went back to ordering it.

“I don’t think people have cooks like before. There aren’t those big families anymore, but people still want to eat home cooking.”

In fact, over at the Rockwell branch, families send their help over at lunchtime for takeout, he said. “They have time to make it? I don’t think so.”

I could write lines and lines of prose about how good everything was, but it’s hard to do justice to recipes older than this reporter, and all of them bringing back a fond memory of a time gone by. Of course, there’s also the factor that almost everything in the menu is made in-house: from the 20 ingredients that go into the halo-halo (a shaved ice desert) not counting the milk, to the ice creams and the bagoong (fermented fish paste).

Mr. Gamboa recalls that as a child, he was placed on ice cream duty. “The flavors are still the same, if not improved. It will still taste like Milky Way Pinoy food.”

Mr. Gamboa says that the secret to surviving that long is, “We’re here everyday… making sure that everybody’s getting the food that they deserve.”

This is the main reason why they haven’t seriously entertained expanding abroad, bringing comforting Filipino food to the migrant population. “We won’t be able to deliver the same level of service,” he said. “Here na lang. Fun pa (Let’s keep it here. It’s fun).”

Some of the strongest restaurants still around from before the 1990s are built around comfort food. As we’ve said before, one can argue that these are all available at home anyway, but what makes them all, including Milky Way, still stand? “We have the strongest cultural connection to that cuisine.

“You’re going to eat that, no matter what.” — JL Garcia

Samsung completes folding phone redesign after screen failures

SAMSUNG Electronics Co. has completed a two-month redesign of the Galaxy Fold to fix embarrassing screen failures that forced its delay, people familiar with the matter say, allowing the Korean giant to debut its marquee smartphone in time for the crucial holiday season.

The world’s largest smartphone maker is now in the final stages of producing a commercial version but can’t yet pin down a date to begin sales, people familiar with the matter said, asking not to be identified describing an internal effort. Samsung pulled the device after several publications including Bloomberg News reported problems with test versions, such as screen malfunctions that emerged after a film on the display was peeled off.

Korea’s biggest company is trying to move past yet another product faux pas. It has now stretched the protective film to wrap around the entire screen and flow into the outer bezels so it would be impossible to peel off by hand, said the people, who have seen the latest versions. It reengineered the hinge, pushing it slightly upward from the screen (it’s now flush with the display) to help stretch the film further when the phone opens.

That tension makes the film feel harder and more a natural part of the device rather than a detachable accessory, they added. The consequent protrusion, almost imperceptible to the naked eye, may help reduce the chance of a crease developing in the middle of the screen over time, one of the people said.

Samsung is keen to salvage its reputation after canceling the April 26 launch of the $1,980 device when folding displays on review models exhibited problems. It had counted on the world’s first mass-produced foldable smartphone to challenge Apple, Inc. and widen its lead over Chinese rivals such as Huawei Technologies Co. Instead, some models developed issues after mere days of use: Bloomberg’s test unit failed to function properly after a plastic layer covering the screen was removed, and a small tear developed at the top of the hinge where the gadget opened.

Samsung will soon start shipping major components for the Galaxy Fold, including the display and battery, to a main plant in Vietnam for assembly while the company debates a launch date, one of the people said. But the company is unlikely to unveil its re-upholstered Galaxy Fold during an Aug. 7 “Unpack” event in New York for the new flagship Note 10 phone, one of the people said. A Samsung representative declined to comment.

The Fold’s postponement marked a setback for a company that had bet on its latest innovation to extend its dominance and ignite a stagnating smartphone market. But the Suwon, South Korea-based firm was keen to avoid the kind of fiasco it suffered in 2016 when it recalled the Note 7, which showed a tendency to burst into flames. Samsung also finds itself in no rush to launch the Galaxy Fold after Huawei postponed the roll-out of its own foldable device, the person said.

Samsung’s shares slid 1.8% Wednesday while South Korea’s benchmark Kospi fell 1.2%.

Foldable phones let users double their screen real estate while also keeping devices compact enough to fit into a pocket. But analysts say it’s unclear whether companies can develop apps to take full advantage of the innovative screen. Samsung’s delay underscored the challenges of creating a display that folds like a notebook, something Samsung spent eight years trying to master.

Even if the phone is made to perfection, the market may not be ready for it: Samsung shipped more than 290 million phones last year, according to Strategy Analytics, but said earlier this year it would produce about one million foldable phones in 2019.

Samsung, which supplies the organic light-emitting diode screens used in Apple iPhones, is also developing a clamshell-like foldable phone and has already created dozens of prototypes, one of the people said.

Bloomberg News reported in March Samsung was working on a pair of new foldable models to follow the Galaxy Fold, including one that folds vertically and another that folds outward like Huawei’s Mate X. The company also envisions smartphones with rollable and stretchable displays in the future, Samsung Executive Vice-President Chung Eui-suk said in February. — Bloomberg

Yields on term deposits decline as offer attracts strong demand

THE CENTRAL BANK’S term deposit facility (TDF) was more than twice oversubscribed on Wednesday, bringing yields down, on the back of strong demand from banks due to recent reserve requirement cuts.

The Bangko Sentral ng Pilipinas (BSP) received P67.548 billion in tenders yesterday, higher than the P30 billion placed on the auction block. This is also higher than the P31.407-billion tenders received last week for its P20-billion offer.

Bids for the seven-day papers amounted to P25.42 billion, which led to the full award of the P10 billion in offer. This is also higher than the P14.41 billion in tenders received a week ago.

Banks sought yields ranging between 4.5% and 4.6% for the one-week term deposits, slightly lower than the 4.58-4.65% margin seen a week ago. This caused the average yield for the papers to decline to 4.5537% from the previous week’s 4.624%.

Meanwhile, demand for the 14-day deposits amounted to P22.095 billion, well above the P10 billion on offer. This is also an increase from the previous week’s bids worth P16.997 billion.

Accepted yields settled within 4.5-4.6999%, declining from the 4.65-4.75% margin seen a week ago. As a result, the average rate of two-week tenor dropped to 4.6129% yesterday from last week’s 4.7002%.

On the other hand, the 28-day term attracted tenders totalling P20.033 billion versus the P10 billion placed in the auction block.

Banks sought yields between 4.5% and 4.75%, leading to an average rate of 4.6347%. The BSP did not offer one-month deposits last week.

The TDF stands as the central bank’s primary tool to shore up excess funds in the financial system and to better guide market interest rates.

The BSP’s Monetary Board last month kept rates unchanged on expectations of steady inflation and economic growth and as it monitors the impact of recent monetary adjustments.

The central bank left the interest rate on the BSP’s overnight reverse repurchase facility untouched at 4.5%. The interest rates on the overnight lending and deposit facilities were likewise held steady at five percent and four percent, respectively.

BSP Governor Benjamin E. Diokno said it is “normal” for TDF to be oversubscribed, which can be attributed to excess liquidity driven by the regulator’s recent reductions to banks’ reserve requirement ratio (RRR).

“There was a time na undersubscribed siya (when the TDF was undersubscribed). Don’t worry too much. Mga blip lang yan (Those are just blips). The economy is growing much faster,” Mr. Diokno told reporters on Wednesday.

After a 100-basis-point RRR cut across all banks last May 31, the BSP trimmed the reserve ratios of universal and commercial lenders and thrift banks by another 50 bps last Friday to 16.5% and 6.5%, respectively.

Another 50-bp reduction will be implemented on July 26 to finally bring the RRR of big banks to 16% and thrift banks to 6%, which completes the phased cuts the BSP announced in May.

Last Monday, asked if the central bank is expecting higher demand for TDF in the coming weeks, retired BSP Deputy Governor Diwa C. Guinigundo said: “Not really because we have actually stabilized the volume of TDF offerings because that’s what we expect to happen in terms of liquidity. More or less stable yung liquidity situation considering on one hand, you have a balance of payments surplus. If you have a balance of payments surplus, that should be expansionary. It will add more peso liquidity to the system.”

“On the other hand, you still have the national government’s money inside the BSP. That actually tightens liquidity conditions. If the government would be able to start spending, and spending more on infrastructure, paying their contractors and their creditors…then you will have a more normal liquidity condition which could possibly increase the TDF volume…. We don’t see that yet,” Mr. Guinigundo said. — Reicelene Joy N. Ignacio

Slow electronics market growth a hindrance to tech investments

By Charmaine A. Tadalan
Reporter

SLOW MARKET growth for the electronics industry is a hindrance to the entry of Taiwan-based technology firms into the Philippines, officials of several companies said.

Wireless broadband solutions provider Browan Communications, Inc. and automobile components company Mobiletron Electronics Co., Ltd. said they have no plans of investing in the Philippines in the near future, while test and measurement firm Tenmars Electronics Co. Ltd. said it is still in the process of looking for distributors in the country.

“Business side, compared to other countries — for example, the TDM (text and data mining) companies in Europe actually bring a lot of business opportunities for us — but the market in the Philippines compared to others is slower, but I think it takes time,” Browan Business Division Senior Account Director Steve Lin said in the Taitronics 2019 pre-show media tour in their headquarters in Hsinchu, Taiwan on June 13.

Browan in July 2018 partnered with Filipino start-up company Packetworx, the first provider of the internet of Things (IoT) solutions in the Philippines. It offers various LoRaWan devices which provide “long-range sensor and control capability devices.”

When asked if Browan sees more investments in the Philippines, Mr. Lin said “for Philippines, I’m not sure so far, but as I mentioned, if there’s business, good and big enough, sure, we will consider.”

For Packetworx founder and chief executive officer Arnold Bagabaldo, to attract more investors to the Philippines, the government should provide the necessary infrastructure for IoT devices, among others.

Sa Philippines, para dumami ‘yung IoT devices…kailangan mo ng network, kailangan mo ng infrastructure para ma-connect ‘yung (In the Philippines, to increase the number of IoT devices, you need the network and infrastructure to connect the) devices to the internet,” Mr. Bagabaldo told BusinessWorld in a June 19 interview at the IoT Technology Hub in Pasig.

“The government plays a big role for that to happen, kasi ang (because the) policy is people invest in a country because they feel safe, they feel that their investment is supported they feel they have a chance, so a lot of that is support from the government.”

Moreover, Browan Product Line Manager Gordon Chang said there is growing sentiment among their consumers to build factories in Southeast Asia as a result of the trade war between the United States and China.

“I hear customers consider instead a factory in Vietnam or in the Philippines or Malaysia. In these three countries, they want to set up their factory there because of the trade war,” Mr. Chang said.

AcBel Polytech Inc., a Taiwanese power supply firm, likewise cited the trade war as reason for its move to expand its existing factories in Taiwan and the Philippines.

Mobiletron Electronics, which specializes in developing components for the automotive industry, said its market in the Philippines is “not so big.”

“You know if you want to build a subsidiary, we have to consider a lot of things — not only the support from the government but also we have to consider thinking about the culture and the employees and also like the facility there,” Mobiletron Electronics Director Robin Chen told foreign media in their office in Taichung, Taiwan on June 13.

“So far, I think for the Asian countries, it’s a good area for us to go there but…we don’t have too much concern to build up a subsidiary in the Philippines today.”

Mobiletron Electronics currently has subsidiaries in China, US and the United Kingdom.

Mr. Chen noted solar power supply may be a viable product in the Philippines in light of environment protection issues.

“Maybe in the future, maybe if we’re talking about energy storage system, that would be a good product for the Philippines in the future because of energy shortage and also you have more sunshine there, so we could think about solar panel and combine with our energy storage products,” he said.

Mobiletron Marketing and Sales Division manager Miriam Lu said one of its subsidiaries had previously distributed electronic buses in the Philippines. “We already worked with Philippines for E-Bus because of environment protection issues, so the government, we discussed with India, we discussed also with Indonesia, I remember also including the Philippines, this is something we can work with.”

Tenmars Electronics, meanwhile, said the company is still looking for importers that will carry their brand.

“Our chairman is looking for more customer to present our Tenmars logo, especially in the Asia market, like Korea, Japan, Singapore, Philippines, Malaysia,” Tenmars Electronics International Sales Director Katy Wang told foreign media in a pre-show tour in their office in Taipei, Taiwan on June 11.

Tenmars manufactures test and measurement products like temperature or humidity data loggers, infrared thermometers, solar power meters, and air velocity meters, among others. It exports mainly to Europe, Japan and the United States.

Browan Communications, Mobiletron Electronics, Tenmars Electronics and AcBel Polytech are among the participants of this year’s Taitronics International Electronics Show hosted by the Taiwan External Trade Development Council, which will be held in Taipei on Oct. 16-18.

Home away

By Noel Vera

Restaurant Review
Junior
1964 Notré-Dame St. W, Montreal, Canada

JUNIOR ISN’T the only Filipino eatery in Montreal, but as all the others are clustered around the Cote-des-Neiges neighborhood it’s the only one that chose to strike out for other pastures, establishing itself in 2014 in Griffintown, a former Irish immigrant community turned industrial area turned urban renewal experiment.

A Filipino restaurant as part of the effort to revitalize an economically depressed community? Why not?

The carinderia/bistro sits in a charming little space, with artwork hanging from brick walls, sports shirts tacked to a board, strings of fiesta lights crisscrossing above the tables. A foodcart stands to one corner, the chairs fold and are painted bright colors, utensils and napkins are stuffed into tall plastic glasses centered on each table. Flanking the glass are bottles of three classic condiments in Philippine cuisine: Mang Tomas’ lechon sauce, pinakurat vinegar, and Jufran banana catsup.

Oh, and the restaurant’s glass front rolls up and turns the whole establishment into an open-air terrace (or terrassé, as they put it here) with some tables more open-air than others (we were right next to the window). This being my first night in Montreal I would soon realize that having an outside patio is almost a law among Quebecois restaurants, ready to throw wide open doors and windows and patios at even the hint or possibility of sun, or of reasonably warm weather.

Still! Watching the people glance sideways as they walked by was a fun way to pass the time while we waited on our food.

We ordered. At one point the server asked with a concerned tone: “That’s three pork dishes. Don’t you want any other kind of meats?” My first impulse was to lecture her on the eccentricities of Filipino cuisine, that while we have a few excellent beef dishes (bulalo — bone marrow and shank boiled in broth — comes to mind) and fish is a mainstay, our genius specialty is pork, in particular pork skin fried or roasted to a seductive crispiness, but thought better of it and instead asked for a vegetable and fish dish.

For drinks we opted for water, a glass of calamansi (Philippine lime) juice, and one other. “What’s ‘Ovaltine?’ one of our party asked. I had to explain: a malt drink, add milk or water; often drunk hot or cold (but mostly hot) for breakfast. Blank stare. I sighed and asked for a cup for him. How long has it been for me? Thirteen years, at least, since leaving the country — more, not having tasted the beverage since childhood.

The cup arrives. I asked for a sip. Yep, exactly what I remember, the nutty malt flavor of Nestlé in hot water. No fireworks or burst of music, no camera zooming in on my face as I recall scenes of a long-forgotten youth — just simple confirmation that the corporation with patented ownership of this oddball chunk of my childhood has not fiddled with my memories, that this much of my past against all odds remains intact. Also, that I still liked the drink, and wonder why I stopped imbibing.

The lumpia sariwa (fresh vegetable eggroll) was less about ubod (heart of palm) than it is about tofu — not kosher, but an interesting variation on what is actually a versatile dish, able to take in shrimp, pork, jicama, and a range of wrappers, heavily garlicked and peanutted and dipped in a dark sweet and savory sauce.

The lechon kawali — basically pork belly fried in a wok — boasted of crispy skin as most Filipino pork dishes should; with steamed rice as its necessary accompaniment (the blank canvas on which it would create garish textures and flavors) and a soy-and-lime dip, the sizzled belly is arguably the highlight of the meal — or would be if it wasn’t for the pork sisig.

The pork sisig — basically chopped up pig’s ears and chunks of pork, boiled then seared then served on a hot plate, what the late Anthony Bourdain once called “my single favorite Filipino street food,” and “possibly the best thing you can ever eat with a cold beer,” and yet another time declared was “everything I love about food” — the plate laid before us that night was a lovely version of the classic dish; where some opt for mayonnaise and others a runny-yolked fried egg, Junior serves it both ways: topped with a brilliantly yellow-yolked egg and drizzled with a decadent dollop of mayonnaise. Mix immediately and temper with steamed rice.

The bangus (milkfish) sisig was our one seafood dish (if I remember right they were out of the squid kilawin or ceviché) and as a lighter version of the pork I thought it was a valid iteration, the fishiness of the bangus nicely countered by a squeeze of lime.

The highlight of the meal, surprisingly, was their Bicol Express. I’m familiar with the homely dish of chopped taro leaf, green-gray and greasy from the coconut milk with chunks of pork; Junior’s version was more like a curry — spicy and rich with coconut milk, briny with shrimp paste, ornamented with pork and bright-red tomatoes and bright-green long beans. Was it still Bicol Express without the taro leaf? It tasted good — that sufficed for me.

The waitress — who we mistook for Filipina but turned out to be Taiwanese (she spoke — to my inexpert ears — excellent French) took the time to chat with us and recommended a few places to see in the city, hoped we’d come back Monday for the five-dollar menu ($5 fried chicken, $5 lumpia — Canadian, not US dollars) while a DJ played from a collection of vinyl records (alas, scheduling problems prevented us from attending). All in all not a bad way to enjoy one’s first meal in Montreal.

Meralco-led consortium’s joint venture with BCDA gets PCC approval

By Janina C. Lim, Reporter

THE Philippine Competition Commission (PCC) has approved the proposed joint venture between the Bases Conversion and Development Authority (BCDA) and the consortium of Manila Electric Co. (Meralco) and Japanese firms Marubeni Corp., Kansai Electric Power Co., Inc. and Chubu Electric Power Co., which will undertake the development of a power distribution system in New Clark City (NCC).

The joint venture will distribute power to the host of locators and facilities in the NCC in Capas, Tarlac for 25 years.

In a Commission decision dated June 25, the anti-trust agency said “the proposed transaction has been found to not likely result in a substantial lessening of competition in the retail electricity supply market within New Clark City and the distribution utility market of generated electricity through a supply agreement in the Luzon and Visayas grids.”

The PCC noted that as more businesses are expected to enter NCC, a development which government is positioning to be Luzon’s next economic growth driver, there will be more potential “contestable customers” who can choose their own power provider and not necessarily be limited to the joint venture firm.

Contestable customers are consumers with an average monthly consumption of at least 750-kilowatts (kW) and are deemed by the Department of Energy (DoE) as qualified establishments to participate in its Electricity Open Access Scheme and choose their own retail power suppliers from anywhere in the country.

“Given the development of New Clark City, the PCC expects an influx of potential locators, particularly agro-industrial and institutional clients, to qualify as contestable customers,” the agency added.

The PCC also noted that the DoE’s recent implementation of the competitive selection process (CSP) ensures competition among distribution utilities and electric cooperatives in securing supply from power generators.

“The antitrust authority views the CSP in securing power supply agreements as important competitive step that would constrain the joint venture’s ability to foreclose other power generation companies,” the agency added.

“Lastly, the PCC sees the competitive constraints posed by other generation companies to limit the joint venture company’s ability to foreclose other distribution utilities and electric cooperatives.”

The Meralco-led consortium will have a 90% stake in the joint venture company, while BCDA holds the remaining 10%.

BCDA is a government-owned and controlled corporation that engages in public-private partnerships to develop public infrastructure such as tollways, airports, seaports, and major real estate developments.

The Meralco-Marubeni consortium comprises of Meralco, Japanese conglomerate Marubeni, and power distributors Kansai Electric Power and Chubu Electric Power.

Marubeni Corp. and its consolidated subsidiaries are engaged in the handling of products and provision of services in the areas of import and export. It also conducts business investment, development and management.

The PCC has so far approved three joint ventures involving the BCDA in relation to the development of the 9,450-hectare NCC.

The others are namely the investment promotion agency’s joint venture with Malaysian firm MTD Capital Berhad for the National Government Administrative Center and with the consortium of PrimeWater Infrastructure Corp., Tahal Consulting Engineers, Ltd., Prime Asset Ventures, Inc., and MGS Construction, Inc., for the water and wastewater management of the city.

Metrobank raises P11.25B in fresh funds from bonds

METROPOLITAN Bank & Trust Co. raised P11.25 billion from the fourth tranche of its P100-billion bond program. — BW FILE PHOTO

By Karl Angelo N. Vidal, Reporter

METROPOLITAN BANK & Trust Co. (Metrobank) raised P11.25 billion in fresh funds via fixed-rate bonds, marking the fourth tranche of its P100-billion bond program.

In a regulatory filing Wednesday, the Ty-led lender said it successfully raised P11.25 billion via the two-year bonds after completing its public offer last June 21.

The two-year debt papers carry a coupon rate of 5.5% to be paid quarterly until July 2021.

The bonds were issued and listed on the Philippine Dealing and Exchange Corp. yesterday.

The total amount raised was higher than the bank’s initial target of P5 billion as it accommodated strong demand from institutional, high net worth and retail clients.

Jette C. Gamboa, Metrobank senior vice president and head of strategic planning and investor relations, said proceeds of the fund-raising activity will be used to support its lending activities and to diversify funding sources.

“Metrobank remains optimistic about the prospects of the Philippine economy, and we will continue to participate in the development of the capital markets,” Ms. Gamboa told BusinessWorld in a text message.

HSBC served as the sole arranger and bookrunner of the transaction. It also acted as a selling agent alongside Metrobank and First Metro Investment Corp.

The fund-raising activity marks the fourth tranche of Metrobank’s P100-billion bond program, bringing the issue size so far to P56.75 billion.

In November, the bank raised P10 billion from the issuance of two-year fixed-rate bonds, carrying an interest rate of 7.15%. This offer was reopened in December to raise an additional P18 billion.

Metrobank also raised P17.5 billion in April via three-year bonds.

Philippine Savings Bank, the thrift banking arm of Metrobank Group, announced on Tuesday its maiden peso bond offering where it wants to raise P3 billion via two-year debt papers from July 1-17 to diversify its funding sources and expand its consumer business.

Metrobank posted a P6.8-billion net income in the first quarter, up 15% from P5.9 billion in the same period last year, driven by consistent lending and margin expansion as well as higher fee-based income.

The bank’s shares stood at P71.50 apiece on Wednesday, down 90 centavos or 1.24% from the previous close.

Boxing with giants: Italy’s packing robots are not just cardboard cutouts

CITTÀ DI CASTELLO, ITALY — Amazon’s new recruit comes from a medieval walled town in central Italy and can box and seal at least 600 items of different shapes and sizes every hour. Twenty-four hours a day, seven days a week.

That recruit is the CartonWrap, brainchild of CMC, a small firm that is just one of 630 Italian companies making automated packaging machines — one of Italy’s fastest growing industries, raking in nearly €8 billion in 2018, or about a quarter of the world market.

Machinery is Italy’s top export, worth almost €50 billion ($57 billion) last year and a rare bright spot for a stagnant economy plagued by low productivity and high unemployment.

And leading the pack is — automated packaging — growing nine times faster than the economy as a whole, according to the trade association UCIMA.

“We doubled our turnover in the last three years and I think we will double it again in the next three years,” said CMC Chief Executive Francesco Ponti.

His father, Giuseppe, a technician with a local packaging company, founded CMC in 1980 in a domestic garage not far from the frescoed 16th century palazzi of Città di Castello.

It now employs 300 people and has revenues of €50 million — thanks mainly to CartonWrap, which measures goods coming down a conveyor belt through a scanner and wraps each in a custom-made box.

Both Amazon and Walmart are customers, though Ponti said client relationships were confidential. Others include the Italian fashion group Gucci, the French retailer Leclerc and the Dutch online shop Bol.com.

FASTER AND CLEANER
At up to 1,000 boxes per hour, CartonWrap machines not only pack much faster than humans; they also save money by reducing packaging waste, CMC says.

“We were doing it manually but the problem was handling the volumes,” Tim Fronzek, co-founder of the German online retailer reBuy.com, which dispatches up to 25,000 items a day, told a CMC customer presentation.

“The machines have allowed us to manage the packaging process more efficiently, and process all outbound shipments in just a few hours with the help of two or three employees.”

The machines may not eat lunch but they do need breaks, for on-site technicians to fix problems and clean away the excess hot glue that can clog the machine.

Production capacity is also limited — CMC can only make five or six machines a month, though it plans to double that soon.

While Italian and German companies dominate the automated packaging market, Chinese competition is growing.

The German robotics firm Kuka and the Italian Romaco group have both been bought by Chinese firms in the last three years — and across industrialized countries, humans will soon become redundant on many packaging lines.

Back at CMC, Francesco Ponti is relaxed.

“There are no more people who want to do this job by hand,” he said.

“If automation grows, the (number of) people who work in automation grow, and the quality of their work will be much better than it is today.” — Reuters

South Africa slings back the f ynbos-f lavored gin

JOHANNESBURG — Last year, gin consumption in South Africa grew by an astonishing 50%, to half a pint for every man, woman, and child. No wonder that distilleries are mushrooming, trying to give a colonial tipple a distinctive flavor of the fynbos.

If the British made use of the freely available local juniper berries to bequeath the taste for gin, it is South Africa’s young entrepreneurs who are exploiting the unique vegetation of the shrub and heathland of the coastal Cape.

From under a dozen gin distilleries in 2015, there are now around 65 nationwide, according to the Gin Box subscription club, supplying outlets from artisanal and farmers’ markets in Cape Town to the gastronomic hot spots of Johannesburg.

“Before craft gin drinks came around, the gins that we had were all imported gins. And they only used international flavors, foreign flavors,” said Albert van Wyk, co-owner of the Johannesburg gin maker Ginologist.

The distillery sits in a refashioned warehouse under Johannesburg’s busiest highway that also hosts live bands and art markets on weekends. Inside, clear liquids bubbled disconcertingly in industrial-size glass vessels above outsize versions of science-lab Bunsen burners.

“Our Citrus Gin gets all its citrus from the region up north in Mpumalanga,” van Wyk said. “And our Floral Gin uses hereditaranium, which is a unique South African flavor.”

Beer remains easily South Africans’ favorite alcoholic drink, and the higher-margin craft beers have also enjoyed a recent upswing.

But analysts say the beer market, craft and commercial, has reached its ceiling, and that South Africans are joining a global trend in shifting to whiskey, brandy, and gin — especially women between 18 and 35. Van Wyk said gin sales in some grocery chains were growing by 40% a year.

A 2018 report by market researcher Euromonitor International found craft spirits in South Africa were set for healthy growth in coming years — even if “increasingly obscure and radical botanical tinctures” risked overcrowding the segment.

South African retailers this year surprisingly reported alcohol performing better than grocery items in an otherwise depressed environment where consumers are spending less.

With the cheapest bottle of artisanal gin averaging around 350 rand ($28), annual consumption around last year’s 15.2 million liters or more should keep the distillers in business for a while yet. — Reuters