THE Philippine Competition Commission (PCC) said it needs a “more detailed analysis” of International Container Terminal Services, Inc.’s (ICTSI) acquisition of a stake in Manila North Harbour Port, Inc. (MNHPI).
In a statement on Thursday, the competition regulator said its Mergers and Acquisitions Office (MAO) decided to open a Phase 2 review, calling for additional information from the companies and stakeholders.
“The initial market investigation conducted by MAO indicates that the transaction may affect the port industry, particularly the markets for the provision of port operation and transshipment services in the Port of Manila. In accordance with the Philippine Competition Act and its Implementing Rules. PCC’s MAO has a period of 60 days from Nov. 15 to carry out Phase 2 of the review,” it said.
In September, ICTSI said it is raising its stake in MNHPI to 50% from 34.83% for P910 million. It bought 4,550,000 MNHPI shares valued at P200 each.
PCC said while it needs a more thorough analysis of the transaction, this does not mean it found a substantial reduction of competition due to the acquisition, saying that it needs more information before it arrives at a conclusion.
“Particularly, PCC’s merger review office seeks to investigate whether the transaction enhances the ability and incentive of the involved firms to engage in foreclosure of competitors where vertical relationships between the ICTSI and Manila North Harbour operations are present, including transshipments,” it added.
Once ICTSI completes the transaction, the remaining 43.33% share in MNHPI will be held by San Miguel Holdings Corp., 6.50% by IZ Investment Holdings, Inc. and 0.17% by Petron Corp.
ICTSI last year bought the 34.83% share of Petron in MNHPI for P1.75 billion.
MNHPI has a 25-year concession agreement to operate, manage and maintain the North Harbor, beginning in November 2009.
ICTSI said in September that the raising of its stake in MNHPI will “allow ICTSI to contribute its experience, expertise and state-of the-art technology and infrastructure to enhance the operational efficiency of the domestic terminal in the Port of Manila and improve traffic conditions in Metro Manila.” — Denise A. Valdez
