MANILA, Philippines – After taking major steps to become debt-free by yearend, Lopez Holdings Corp is considering investing more in its core power business, but only if it means not taking on more loans.
Lopez Holdings’ primary power generation and energy-related subsidiary First Gen Corp has “successfully laid the groundwork for international operations,” said chairman Manuel Lopez, who is currently the Philippines’ ambassador to Japan, during the company’s annual shareholders’ meeting on Friday, June 1.
“After signing deals with an Australian company to co-develop geothermal resources in Chile and Peru, First Gen is also considering Indonesia as a possible expansion site,” he said.
However, the conglomerate is not keen on taking on more debt after taking nearly a decade to settle the obligations it racked up from its dollar-denominated loans in the late 1990s and early 2000s.
The company aims to be debt-free by yearend and finally declared dividends to stockholders for the first time in 2011.
“There are proposals but you have to consider the shareholder sentiment. We don’t want to incur additional loans for additional investments. So in case we invest in another company or project we want it to be as much as (possible) cash payments or internally generated from our shareholders,” said assistant vice president Milani Caimol at the sidelines of the annual stockholders’ meeting.
Favoring a cash investment, Caimol pointed out that, “as of March, we still have P1 billion in cash.”
Still keen on PPP
Lopez reiterated his interest in the government’s major public-private partnership (PPP) “involving power plants.”
Of the 22 projects the government has set out under the PPP scheme, only one involves energy – the estimated P1.6-billion project involving the Angat Hydro-Electric Power Plant in Bulacan.
Lopez-led First Gen earlier bid on the project through a joint venture partnership with the Ayala and Pangilinan conglomerates. However, the powerful partners were edged out by a bid from Korea Water Resources Development Corp (KWater) of South Korea. The awarding was halted and is being decided by the Supreme Court amid claims the bidding for the PPP was not transparent.
Lopez Holdings seems to not have lost interest in the project.
“Participation in infrastructure, in PPPs is in support of the operating units,” said Caimol.
She said the company probably wouldn’t venture outside its core businesses. “If we will have plans it will be in the direction of what we have now, expanding what we have,” she said. – Rappler.com