The National Government (NG) has raised its privatization target for 2008 as it expects to fetch better-than-expected prices for the assets on the pipeline.
According to documents from the Development Budget Coordination Committee (DBCC), the new privatization target for this year is set at P48.525 billion or P18.96 billion higher than the previous target of P29.562 billion.
Among the assets to be put on the auction block this year is the 100-hectare Food Terminals Inc. property in Taguig. The government expects to sell this in the second quarter of the year and raise at least P15 billion from the sale.
Also on the auction block this year are the government’s stakes in San Miguel Corp. (worth P50 billion) and Manila Electric Co. (valued at about P10 billion).
The government will also sell a real estate property in Fujimi, Japan valued at P1.3 billion and the old penitentiary in Muntinlupa.
The government has yet to determine the value of the Muntinlupa property.
As of end-November 2007, proceeds from the privatization of state-owned assets reached an all-time high of P90 billion.
Aggressive efforts by fiscal authorities to sell state-owned assets have paid off, with year-to-date proceeds beating the revised privatization target of P25.3 billion for 2007 and the original target of P500 million.
Finance Undersecretary for Privatization Crisanta Legaspi earlier said that inflows from the recent sale of the government’s stake in Philippine National Oil Co.-Energy Development Corp. (PNOC-EDC) accounted for the better-than-expected privatization proceeds as of end-November 2007.
The government has raised P58.5 billion from last month’s sale of its stake in PNOC-EDC, the country’s leading geothermal firm.
Red Vulcan Holdings Corp., a consortium led by First Gen Corp. of the Lopez Group, has bagged the government’s 60 percent stake in PNOC-EDC. The consortium offered a bid of P58.5 billion, topping other offers including a bid from the Filinvest group amounting to P48.52 billion.
The winning bid exceeded government expectations. Originally, the Department of Finance expected to raise between P32 billion to P36 billion from the PNOC-EDC auction.
For 2006, the government was able to raise P5.8 billion from the sale of state-owned assets.–Iris C. Gonzales, Philippine Star