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MANILA, Philippines – Two multibillion-peso deals secured approval from the Philippine Competition Commission (PCC), the country’s antitrust body.
The PCC announced on Tuesday, August 29, that it has approved the acquisition by Japan Tobacco (Philippines) Incorporated (JTPI) of Mighty Corporation, as well as the joint venture by Rockwell Land Corporation and Mitsui Fudosan (Asia) Pte Ltd.
The PCC found that neither of the deals would hurt consumers.
“There appears to be no ability nor incentive for the parties to engage in anti-competitive coordinated behavior. Sufficient competitive constraints remain from other market participants after the sale,” the PCC said in a statement.
JTPI is the local subsidiary of global tobacco player Japan Tobacco International (JTI), whose global brands include Winston and Camel.
JTPI agreed to acquire Philippine cigarette manufacturer Mighty Corporation for $1 billion after the latter found itself in hot water with the government for tax evasion cases amounting to more than P30 billion.
Mighty’s owners, the Wongchuking family, said they would use the proceeds of the sale to fund their P25-billion tax settlement.
Mighty has an estimated 20.5% share of the Philippine tobacco market, while JTPI controls 5.1%, according to a 2016 report by research firm Euromonitor International. Following the deal, JTPI will control 25.6% of the market.
That would still be dwarfed, however, by Lucio Tan-led Philip Morris Fortune Tobacco Corporation (PMFTC). The company, which manufactures Fortune and Marlboro, has a 65.1% market share.
Rockwell Land-Mitsui Fudosan venture
The PCC also gave the go signal for a joint venture between Lopez led-Rockwell Land and Japan-based developer Mitsui Fudosan.
The two firms are set to engage in the development, construction, and sale of real estate projects in the Philippines through joint venture company Rockwell MFA Corporation (RMFA).
RMFA’s initial project is a P9-billion, 3-tower residential development called The Arton in Quezon City.
Under the terms of the joint venture, Rockwell Land and Mitsui Fudosan will purchase and subscribe to shares in RMFA, where 80% of the total outstanding shares will be held by Rockwell Land and 20% will be held by Mitsui Fudosan indirectly through its wholly-owned Philippine subsidiary, which is in the process of incorporation with the Securities and Exchange Commission (SEC). – Rappler.com
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