People gather outside the V-Mall where gunshots rang out inside, in Manila, Philippines, on Monday. AP

A sacked security guard gave himself up and set free dozens of hostages he seized at gunpoint Monday in a Manila mall, ending a day-long standoff that terrified shoppers and left one man wounded.

The gunman, who launched the attack over his dismissal, walked out of the V-Mall and was able to complain to reporters about his former employers before police tackled him.

Authorities initially said about 30 people were held in an office inside the mall, but once the standoff ended they said the number was up to 70.
"The crisis is over," said Francis Zamora, mayor of San Juan City, which includes the mall. "They're all safe now."

The drama kicked off on Monday morning when the suspect shot and wounded another security guard, who was rushed to hospital in stable condition, and barricaded the hostages in an office.

The gunman was armed with a pistol and what he claimed was a hand grenade when he burst into the mall, sending terrified shoppers and workers fleeing.

Heavily armed police in battle gear and carrying assault rifles massed at the shopping centre while scores of onlookers snapped pictures with their mobile phones.

Members of a police SWAT team prepare to enter a mall after a hostage situation in Manila on Monday. AFP

"We have confirmed reports of... a hostage-taking of some of our employees by a former... security guard," the mall management said in a statement.

The Philippines' malls are centres of life that include everything from restaurants and shops to churches and medical facilities. The building was full when the violence began.

The mayor of the section of Manila that is home to the mall told reporters the "disgruntled" ex-guard had a pistol and claimed to have a grenade, but that had not been confirmed.

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"At present we are unable to determine exactly how many are inside. Our estimate is around 30 people," said San Juan city mayor Francis Zamora.

He added the hostages were being held in the mall's administrative offices and at least one person was shot. The victim was rushed to hospital and was in stable condition.

Negotiations

Witness John Paul Buenavista told AFP he saw a wounded person — believed to be a guard at the mall — being put into a wheelchair and whisked away.

"We heard three gunshots. Then we saw people running, saying they saw someone getting shot," he said.

A man cries as he talks to reporters after going out of the V-Mall in Manila on Monday. AP

Authorities are negotiating with the hostage taker, who has demanded to speak with other guards and the media.

"We'll do our best to settle this issue peacefully," Zamora said, adding the hostage taker was upset over his treatment by his employer.

Manila was the site of a high-profile 2010 hostage taking that ended in the deaths of eight tourists from Hong Kong.

That day-long ordeal started when an ex-police officer, armed with an M-16 assault rifle, hijacked a bus near Rizal Park, a popular tourist destination just a few blocks from police headquarters, in a desperate bid to get his job back.

Negotiations broke down after nightfall when the ex-officer began shooting passengers, prompting commandos to lob tear gas inside the bus before storming it and firing dozens of bullets into the vehicle.

Agence France-Presse