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PSALM dangles P2.007-B price in Malaya plant’s negotiated sale

State-run Power Sector Assets and Liabilities Management Corporation (PSALM) is dangling P2.007 billion as its negotiating price in the targeted divestment of the 650-megawatt Malaya thermal power facility and its underlying site.

The sale price was slashed marginally — from the P2.188 billion minimum bid price set by the government-owned company when the asset was last placed on the auction block last September 23.

In a tender notice that PSALM issued this week, it stated that it is inviting interested parties “to join the negotiated sale process and thus submit offers for the privatization of the Malaya thermal power plant.”

The asset-seller firm emphasized that “a financial offer submitted lower than the minimum offer price shall be rejected outright.”

In the Duterte administration, the Malaya plant has been attempted to be sold three times – undertaking two auctions last year; and one this year but all ended in failed bid processes.

For the negotiated deal, PSALM indicated that “an interested party must first submit letter of interest (LOI)” to the designated committee involved in the facility’s divestment.

“Interested parties who submit the LOI must be the one to participate in the negotiated sale process, submit an offer and enter into the pertinent agreements,” the government-owned company said.

It specified that companies (including their affiliates and subsidiaries) would not be allowed to join the negotiated sale process if they have ongoing dispute resolution or unsettled issues with PSALM.

The state-run company added “the negotiation package may be secured from PSALM upon submission of a duly-executed and notarized confidentiality agreement and undertaking,” pursuant to the prescription of Section 78 of the Electric Power Industry Reform Act.

“The duly executed confidentiality agreement and undertaking must be received by the Committee on or before 3:00pm of October 22, 2020 to entitle an interested party further participation in the negotiated sale process for the purchased assets,” PSALM noted.

The package, in particular, contains terms on the negotiation procedures and the Asset Purchase Agreement (APA), or the contract that will bind the sale process.

The issuance of the negotiation package started on October 5 (Monday) and this will be until October 22, 2020, which is the slated deadline on submission of offers.

“Only interested parties that have been issued the negotiation package by the deadline, or consortium, will be allowed to participate further in the negotiated sale process for the purchased assets,” the company-seller said.

Source: Manila Bulletin (

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