Competition Commission clears Prime Infra–First Gen gas acquisition

The Philippine Competition Commission has found no competition concerns in the proposed Prime Infrastructure–First Gen gas and liquefied natural gas transaction after completing a Phase 1 review of interlinked horizontal and vertical energy markets.

In a statement dated December 3, the PCC said Prime Infrastructure Capital, Inc.’s acquisition of majority stakes in seven First Gen holding companies “is unlikely to result in a substantial lessening of competition in any of the identified markets.”

The regulator said the transaction covers significant energy assets, including the 1,000-megawatt Santa Rita, 500-MW San Lorenzo, 450-MW San Gabriel, and 97-MW Avion power plants.

The review also covered the planned 1,200-MW Santa Maria project and an interim offshore LNG terminal.

The share purchase agreement, signed in July, is valued at about PHP 50,000,000,000.

Prime Infrastructure is part of the Razon & Co. Inc. group and holds investments across infrastructure, water, and energy.

The group also holds a combined 45 percent participating interest in the Service Contract 38 Consortium that operates the Malampaya Gas Field through subsidiaries Prime Energy Resources Development B.V. and Prime Oil and Gas, Inc.

First Gen, owned by Lopez, Inc., operates geothermal, hydro, wind, solar, and natural gas power facilities nationwide.

The PCC’s Mergers and Acquisitions Office assessed the merger across two horizontal markets and four vertical markets to determine any impact on competition.

In renewable energy generation, the PCC concluded that the combined entity will become the largest firm “but only by a minimal margin,” noting that the market remains unconcentrated due to “numerous existing and prospective players.”

In the retail electricity supply market, the PCC found that the firms’ combined share remains “significantly below major players,” with strong competition maintained through customer switching and the presence of multiple licensed suppliers.

For vertically linked markets, the PCC said there is no ability or incentive for the firms to engage in any foreclosure strategy.

The regulator compared the deal with a December 2024 LNG and power sector acquisition involving Meralco PowerGen Corp., Therma NatGas Power Inc., and San Miguel Global Power Holdings Corp., where behavioral conditions were imposed due to coordination and foreclosure risks.

The Commission said no similar risks were found in the Prime Infra–First Gen transaction.