Philippine competition watchdog rules out threat of Aboitiz Power's AA Thermal acquisition

Aboitiz Power bought a 49% voting stake and 60% economic stake in Ayala Corporation’s thermal assets.

Aboitiz Power’s acquisition of AA Thermal will not likely result in a substantial lessening of competition in the markets for power generation and retail electricity supply in the Philippine islands of Luzon and Visayas, the Philippine Competition Commission (PCC) said.

Aboitiz Power Corporation bought a 49% voting stake and a 60% economic stake in AA Thermal Inc., AC Energy's thermal platform in the Philippines for a total of $579.2m.

In a decision the PCC published, it said Aboitiz Power will only acquire a minority stake in AA Thermal. Moreover, there will be no change of control in the operating companies, GNPower Mariveles Coal Plant (GMCP) and GNPower Dinginin (GNPD), that would give Aboitiz Power an increased ability to influence their actions.

There is also no increased ability to engage in foreclosure post-transaction, and there are sufficient post-transaction constraints from other power generation and electricity suppliers.

“The Commission hereby resolves that it will take no further action with respect to the proposed acquisition by Aboitiz Power of share of stock in AA Thermal,” said PCC chairman Arsenio M. Balisacan.