London-listed Ashmore Group has been cleared to buy Saudi Aramco's 40 per cent stake in Petron Corp for $550 million, the Philippine government said Monday.
The Philippine government, through Philippine National Oil Co (PNOC), will keep its holdings in Manila-listed Petron at 40 per cent and would not match Ashmore's offer, PNOC chairman Antonio Cailao told a news conference.
"We are reaffirming the approval of the sale of Aramco Overseas Co's 40 per cent equity in Petron," Cailao added.
Ashmore, through unit SEA Refinery Holdings, had offered to buy Saudi Aramco's 3.75 billion shares in Petron, currently held under the name of unit Aramco Overseas Co., for $550 million.
State-owned PNOC owns 40 per cent of Petron, one of the only two oil refiners in the Philippines.
Under an agreement between PNOC and Aramco signed in 1994, Aramco should first offer its 40 per cent stake in Petron to PNOC in case it decides to exit the company before it entertains offers from other buyers.
Energy Secretary Angelo Reyes said buying out its Saudi partner would have contradicted Manila's "policy of privatising government stakes in corporations and letting the private sector run commercial enterprises as effectively and efficiently as possible."
Saudi Aramco supplies the crude oil requirement of Petron, which in turn accounts for about 40 per cent of the Southeast Asian nation's total fuel requirements.