UPDATE 2-Manila okays $550 mln Petron stake sale to Ashmore

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By Karen Lema

MANILA, May 12 (Reuters) - State-owned Philippine National Oil Co (PNOC) said it will not exercise its preemptive right on the $550 million sale of Saudi Aramco's 40 percent stake in oil refiner Petron (PCOR.PS: Quote, Profile, Research, Stock Buzz) to investment fund Ashmore Group (ASHM.L: Quote, Profile, Research, Stock Buzz).

PNOC also holds 40 percent of Petron and has first rights on any sale of Aramco's stake, but chose at a board meeting on Monday to allow the deal with the London-based fund to go ahead, officials said.

"We based our decision on a number of factors including the fact that the purchase of these shares by the government runs contrary to our policy of privatising government stakes in corporations and letting the private sector run commercial enterprises," Energy Secretary Angelo Reyes said in a statement after the meeting.

PNOC also did not exercise an option to transfer the right to purchase the stake to a third party.

Reyes said last week that Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) had approached PNOC with an offer to buy the stake.

Morgan Stanley was representing Thailand's PTT PCL PTT.BK, according to Rey David, president of state-run Development Bank of the Philippines, one of the financial advisers to PNOC.

Last week, JG Summit Petrochemical Corp, owned by the Gokongweis, a local business family, said it was offering about 24.5 billion pesos ($575 million) for PNOC's stake in Petron.