The Manila Standard Today reported that the Philippine government is confident of selling its minor stake in Subic Shipyard Engineering Inc, its first privatization effort for the year.

Mr John Philip Sevilla finance undersecretary, who heads the Finance Department’s privatization efforts, said that listed Keppel Marine Philippines Inc had indicated its interest to acquire the government’s stake in Subic Shipyard as early as last year.

The government had planned to sell its holdings in the company last year, when most of the shareholders of Subic Shipyard sold their respective stakes to Keppel, allowing the Singaporean firm to double its ownership to 79.1%.

Mr Sevilla said that "We'd be surprised if Keppel does not bid on the shares. They wanted to acquire it since last year but it is only now that we are able to put up the shares for disposal."

It may be noted that Keppel acquired the shares of Magsaysay Shipping Corporation, International Container Terminal Services Inc, SM Development Corporation and Insular Life Assurance Co for PHP 2.8 billion in 2010.

He said the government was auctioning the shares for transparency. He added that "It would make sense for Keppel to acquire it since it already owns majority of the shares in Subic Shipyard. Of course, there could be other buyers out there, we'll see how the auction goes."

The government's 8.76% stake would raise Keppel's shares in Subic Shipyard to close to 87.86%. Subic Shipyard will be auctioned off at a floor bid price of PHP 584.77 million. The government plans to use the proceeds of the sale to raise extra funds to support this year' budget requirements.

The Privatization & Management Office has said it will sell the 89.6 million common shares in one block through public bidding and on an as is, where is basis.

(Sourced from www.manilastandardtoday.com)