3 weeks ago
6
Merkado Barkada
February 25, 2025 | 8:10am
Synergy Grid [SGP 11.70, down 4.1%] [link], the holding company used to own National Grid of the Philippines (NGCP), the country’s transmission monopoly, was halted yesterday after it received a notice of Final Award issued by the Arbitral Tribunal of the Singapore International Arbitration Centre (SIAC) in its dispute with PSALM and TRANSCO. The SIAC found that NGCP did not breach constitutional nationality restrictions, the Anti-Dummy Law, or its obligations as part of its concession agreement. SIAC said that NGCP would only need to pay P372 million to TRANSCO out of TRANSCO’s original claim of P3.9 billion in damages and that NGCP’s P57.9 billion prepayment from 2013 was valid. The ruling also confirmed NGCP’s ability to construct its annual Transmission Development Plan and to interface directly with regulators.
MB bottom-line: The interesting bit to me was that the arbitrators upheld NGCP’s ability to “use the Transmission Assets which includes the right to use such assets for a Related Business, including for a telecommunications system”. I don’t think there’s a lot of upside in some 1980s/90s landline system, but I wonder if there’s any possibility for NGCP to become a player in the fiber-optic line game being played between Converge [CNVRG 16.64, down 0.4%], Globe [GLO 2264.00, down 0.6%] and SMART [TEL 1380.00, up 0.1%]. I also wonder if that language could be twisted to include the use of the right-of-way for the transmission lines for other things like pipelines, roads, or railways. Just something that got my creative mind creaking back to life. SGP was halted to start the day yesterday, but it really fared quite poorly once that halt was lifted: the stock drifted almost 5% lower on light volume. Not a lot of buying interest.
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