Utilities

Benpres is the only large listed Philippine conglomerate which focuses on utilities and basic infrastructure. Its presence in strategic industries provides steady earnings and cash flow. The Benpres portfolio covers what may be called non-cyclical, defensive businesses that can protect shareholder value even when the general economy slows down.

Utilities

Power and Energy

Benpres has interests in both power generation and electricity distribution. These interests are managed through First Philippine Holdings Corporations (FPHC). Core companies under FPHC are First Generation Holdings Corporation for generation and Manila Electric Company for distribution.

First Philippine Holdings Corporation (FPHC), which is 47.02% owned by Benpres as of December 31, 2001, is a holding company engaged in infrastructure development, with core business in power generation and distribution, and strategic initiatives in manufacturing, construction and engineering services, and property development.

First Generation Holdings Corporation (First Gen), was incorporated in December 1998 to become the primary holding company for the power generation and energy-related businesses of the Lopez Group. It is the largest vertically-integrated power generation company in the Philippines, with an installed capacity of 2,582MW, accounting for approximately 16% of total installed capacity in the country today. As a world-class energy company, First Gen's Management System is certified against the requirements of ISO 9001:2000 (Quality Management).

First Gen seeks to develop expertise across the whole range of power generation technologies especially in natural gas, diesel, geothermal, and the renewables wind and solar. First Gen aspires to become the premier power generation company in the Philippines. Its long-term vision is to expand internationally.

Manila Electric Company (Meralco) is the largest electricity distribution company in the Philippines, posting sales of 22.7 billion kilowatt-hours to 3.8 million customers in 2001. Its franchise covers the whole of Metro Manila, the provinces of Bulacan, Rizal, and Cavite, and parts of Laguna, Quezon, Batangas and Pampanga provinces.

FPHC is the single largest private shareholder of Meralco. On September 4, 1997, Benpres consolidated its power and energy interests into FPHC, transferring its 1.7% Meralco stock for an increase in share capital in FPHC.

Utilities

Infrastructure

Benpres has concessions in tollway operations and water distribution. The tollway initiative will begin commercial operations in September 2004 while the water project became operational in August 2002.

First Philippine Infrastructure Development Corporation (FPIDC), established in February 1994, is 30% owned by Benpres. FPIDC entered into a joint venture in 1997 with the Philippine National Construction Corporation (PNCC) and Egis Projects S.A., the investment and systems integration arm of the largest toll road operator in the world, Group Egis, to organize Manila North Tollways Corporation (MNTC). Under the terms of the joint venture agreement, FPIDC will hold 60% of the capital of MNTC, PNCC will hold 20% and Egis Projects S.A. (formerly Trans Route) will hold 20%.

MNTC is embarking on three construction and rehabilitation projects - the rehabilitation and expansion of the approximately 84 kilometers of the existing North Luzon Expressway (NLE); the construction of the northern arc of the 22-kilometer Circumferential Road C-5 which connects the current C-5 expressway with the NLE; and the construction of a 57-kilometer Subic arm of the NLE to Subic Bay Metropolitan area.

Maynilad Water Services, Inc. (MWSI) was awarded the western half of the Metro Manila water distribution concession in August 1997. Maynilad Water is tasked to transform the operation of a 119-year old water utility into an efficient and modern water distribution system, aside from setting up sanitation and sewerage systems. In the course of its 25-year concession agreement with government, Maynilad Water will supply clean water 24 hours a day to approximately six million people in the western zone in 10 years. This area has some 500,000 subscribers with only about two-thirds having access to potable water.

Maynilad Water is 59% owned by Benpres, 1% by Metropolitan Bank & Trust Co., and 40% by Ondeo, a French multinational company with interests in water treatment and distribution, construction, broadcasting and communications, energy and waste management.