Oct. 29 (Bloomberg) -- San Miguel Corp., the Philippines' biggest food and beverage company, plans to buy a controlling stake in Petron Corp., the larger of the nation's two refiners, to expand into the energy business, President Ramon Ang said.

``We think investing into energy will give us better returns than any other field,'' Ang said in a phone interview today. ``We know what we're doing and this is the best for our shareholders.''

San Miguel wants to buy a 51 percent stake in Petron from Ashmore Group, the Philippine Daily Inquirer reported earlier today, citing Ang. London Ashmore Investment Management Ltd. has a 51 percent stake in Petron and had been offered to buy a 40 percent interest held by the government. The Philippines government is selling its stake to fund the budget deficit.

Ashmore will exercise its so-called ``right of first refusal'' over the government's stake and is in talks to sell part of it to San Miguel, Petron President Eric Recto said in a separate phone interview.

Petron shares rose a second day in Manila trading. The stock jumped as much as 6.6 percent to 4.85 pesos and was traded at 4.70 pesos at 10:50 a.m. in Manila. San Miguel was up 2.2 percent at 47.50 pesos.

San Miguel on Oct. 27 said the company's board authorized management to start talks with Ashmore Group for a ``possible stake'' in Petron.

To contact the reporter on this story: Clarissa Batino in Manila at cbatino@bloomberg.net.

Last Updated: October 28, 2008 22:51 EDT