The private investment arm of the World Bank will give financial help of $200 million to $250 million to whoever wins the bid for a multi-billion-dollar 25-year licence to run the Philippines' power grid, an official of the agency said.
The financial assistance, which would come from the International Finance Corp's (IFC) infrastructure development facility, may still be increased, Jesse Ang, the IFC's principal investment officer told reporters at the weekend. "We're looking forward to working with the winning bidder to provide whatever financing support will be needed," Ang said. Bids may be sought in the fourth quarter for the licence to operate the National Transmission Corp (Transco). It would be the government's fifth attempt since 2003 to privatise the grid, whose assets are valued at 138 billion pesos ($2.96 billion).
The grid is likely to require $850 million over the next five years for upgrades and expansion.
Only one bidder - a consortium of Philippine investment firm Citadel Holdings Inc and Italian power grid operator Terna SPA - turned up when the assets were last offered in February.
Another investment group, Triratna Holdings Corp, composed of top Philippine business leaders including San Miguel Corp President Ramon Ang, did not submit a bid but said it would consider participating in the next auction. Philippine holding firm Metro Pacific Investments Corp said last week it was looking for a foreign partner before bidding for the power grid.
The government wants to raise up to $5 billion by selling the power grid and 31 power facilities of debt-strapped National Power Corp as part of fiscal reforms.