Petron Corp., the Philippines' largest oil refiner, said Friday that Saudi Aramco aimed to sell its 40 percent stake in the firm to British investor Ashmore Group for $550 million. State-run Saudi Aramco, the biggest oil refiner in Saudi Arabia, told the Philippine government of its plan to sell all of its shares in Petron to Ashmore-owned SEA Refinery Holdings, a Petron statement said. State-owned Philippine National Oil Co. (PNOC), which owns 40 percent of Petron, said it will “evaluate the terms and conditions associated with this offer, and decide whether to exercise its Right of First Offer to purchase the shares.” PNOC president Antonio Cailao said his company “will carefully evaluate this filing with the diligence and rigor necessary and appropriate to determine the best course of action.” “We have received a notice from Aramco Overseas regarding the proposed sale of its shares in Petron, and will carefully evaluate this filing with the diligence and rigor necessary and appropriate to determine the best course of action,” said PNOC President and Chief Executive Antonio Cailao. In 1994, the government privatized Petron, with PNOC selling a 40 percent stake to Aramco Overseas for $535 million. PNOC held onto another 40 percent and sold 20 percent to the public. President Gloria Macapagal Arroyo said in a statement that Ashmore's decision to purchase Aramco's Petron shares is “a vote of confidence in Petron and the positive environment that has been created for foreign investment in our country.” She said Ashmore “knows the Philippines well through its investment in our international financing and in an important utility, Maynilad Water.” At the exchange rate of 41.45 pesos to the US dollar, Ashmore's offer values Petron at 6.08 pesos per share, compared to Thursday's close of 6.10 pesos. Its shares fell 1.7 percent Friday to 6 pesos. “Petron's business remains strong and I am confident that our momentum will continue,” said Petron Chairman and Chief Executive Nicasio Alcantara. The company is looking forward “to continuing our relationship commercially under Saudi Aramco's commitment to maintain crude oil supply,” he said. Petron operates a 180,000 barrel a day refinery and supplies nearly 40 percent of the country's oil requirements, according to its statement. It also has more than 1,250 service stations, the largest network in the Philippines. She said that she understood Saudi Aramco's decision, and was pleased that the company “will maintain its ties to the Philippines through the commitment ... to maintain strong commercial ties with Petron after the sale.” Petron president Nicasio Alcantara said Petron's position of leadership in oil refining would not change “regardless of the company's ownership structure.” He expects Petron's relationship with Aramco to continue under its “commitment to maintain crude oil supply.” “I am confident our momentum will continue,” he said, citing Petron's net profit rising to 6.01 billion pesos (145 million dollars) in 2006 from 2.92 billion pesos in 2002. Petron sold 40 percent of its shares to Saudi Aramco in 1994 with 20 percent being sold off to private investors. __
