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| Chinese Electricity Bid Nears Conclusion |
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The proposal by the State Grid Corporation of China, the country's biggest electricity distributor, to purchase the Philippines' Government-owned power grid may be decided shortly, sources close to the deal say. State Grid is working with US private equity firm Carlyle Group to bid for National Transmission Corp (TransCo), the sole power transmission provider in the Philippines, the sources said. The State Grid-Carlyle bid is one of three consortiums expected to offer US$2.5-3.0 billion for the rights to operate TransCo for 25 years. State Grid declined to comment on the deal but said in October the company President Liu Zhenya met Philippine President Gloria Marcapagal Arroyo. At the meeting the President showed strong interest in the deal, saying State Grid could give valuable experience to Philippine businesses, the company said on its website. The Philippine Government is making its fourth attempt to sell the assets to help pay some of the US$6.8 billion debt of the state-owned energy producer, National Power Corp, from which TransCo was formed in 2001. Ranked 32nd on the Fortune Global 500 State Grid accumulated total assets of 1.18 trillion yuan (US$148.94 billion) by the end of 2005. State Grid plans to almost double its electricity-sales volume to 2,200 billion kilowatt-hours within the next five years. It also aims to increase its revenue to 1.1 trillion yuan (US$135.6 billion) by 2010. Earlier reports said the company would go public on the Hong Kong and Shanghai stock markets. However, State Grid's Liu denied the reports saying the company didn't plan such a move anytime soon. The company started to build the country's first ultra-high voltage transmission line in August. The 1,000-kilovolt line will supply the city of Jingmen in energy-hungry Hubei Province with power from the southeastern parts of coal-rich Shanxi Province. The reported profit of the electricity industry was 103.8 billion yuan (US$13.14 billion) during the first 10 months of this year. This is an increase of 37.2 percent year-on-year. (China Daily December 7, 2006) |
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