M&A notifications hit P4.56T in value as of 2021 — PCC
The Philippine Competition Commission (PCC) had received notifications on 225 merger and acquisition (M&A) transactions with combined value of P4.56 trillion as of end December 2021 and vowed to initiate competition efforts in critical sectors – bus transport, telecommunications, and water. .
Arsenio Balisacan, who chaired the anti-trust body since its establishment in 2016 until he was named Socio-Economic Planning Secretary of the Marcos administration, said in its Annual Report 2021 that PCC has diligently monitored transactions that may significantly increase market concentration that could lead to the creation of monopolies, erect barriers to entry, or encourage anticompetitive conduct, and as such must undergo competition review to ensure the protection of consumer welfare.
In 2021 alone, there were only four M&A notifications with total value of P470 billion, involving two real estate, one finance and insurance and one transportation and storage. PCC approved two of these transactions, while two were withdrawn because they were exempt from compulsory notification.
By sector, manufacturing has the most number of M&A notifications at 55 with total value of P1.513 trillion, followed by finance and insurance services with 37 for a total of P719.243 billion, and real estate with 33 notifications for total value of P607.540 billion.
Electricity and gas generated 27 notifications, transportation and storage with 18, wholesale and retail with 17, and administrative and support services with 11. The rest were water supply, sewerage, waste management; human health and social work; accommodation and food service; agriculture, forestry and fishing; education; construction; information and communication; and mining and quarrying.
Moving ahead, the PCC said it will focus competition analysis and enforcement on sectors considered essential during the recovery period from the pandemic. These are e-commerce, health and pharmaceuticals, food and agriculture, energy and electricity, insurance, construction, water, and telecommunications.
The PCC will also monitor markets and initiate motu propio merger reviews of transactions that may have substantially lessened competition. Once the two-year period under the Bayanihan 11 Act expires in September 2022, review of M&As under lower and adjusted thresholds shall resume.
It will also conduct market studies in the sectors of bus transport, telecommunications (internet service providers, wholesale brandband, and spectrum management), and water will be initiated.
The commission will also continue conducting competition impact assessments, focusing on the energy, food, and sports sectors.