ICTSI buys Petron's stake in Manila North Harbor

MANILA, Philippines – International Container Terminal Services Incorporated (ICTSI) of port magnate Enrique Razon Jr is buying Petron Corporation's 34.83% stake in the biggest domestic port, the Manila North Harbor, for P1.75 billion.

ICTSI and Petron on Thursday, September 21, signed a share purchase agreement for the acquisition of 10.45 million Manila North Harbor shares. These represent 34.83% of the total issued and outstanding shares of the Manila North Harbor.

"This transaction will further improve the returns of ICTSI's shareholders through this value-accretive acquisition. The purchase price was determined based on mutually agreed multiples of earnings," ICTSI disclosed to the Philippine Stock Exchange (PSE) on Friday, September 22.

ICTSI said the transaction will be paid on October 30. (READ: Termination of Nigeria contract pulls ICTSI's income to over $100M)

For Petron, which is led by tycoon Ramon Ang, the sale will allow it to focus on its core business: oil and gas.

Joel Angelo Cruz, vice president and general counsel of Petron, said the completion of the sale purchase agreement is subject to several conditions, including approval of the transaction by the Philippine Ports Authority (PPA).

Harbor Center Port Terminal Incorporated owns the remaining 65% stake in the Manila North Harbor.

The Manila North Harbor operates a 52.5-hectare multi-purpose port terminal used in handling general cargo and passenger accommodation. It services close to 4,000 vessels per year, according to its website.

The PPA granted Manila North Harbour Port Incorporated (MNHPI) a 25-year renewable contract to develop, manage, operate, and maintain the Manila North Harbor. Inked in November 2009, the contract is renewable for another 25 years.

ICTSI, meanwhile, has a portfolio of 29 container terminal operations in 21 countries across 6 continents. – Rappler.com