Ayalas to give up MRTC, Makro

Ayala Land Inc. (ALI) is poised to give up its investments in non-property affiliates such as Pilipinas Makro Inc. and Metro Rail Transit Corp. in a bid to further rationalize operations and sharpen its focus on real estate and infrastructure projects, a top company official said.

ALI president Francisco Licuanan III told reporters that while there are no definite divestment plans at the moment, the company would be willing to let go of these interests "at the right price."

ALI has a 15.8-percent economic interest in MRTC, which owns and operates the Metro Rail Transit system or MRT 3 running along EDSA. In addition, it holds 28 percent of Pilipinas Makro, which is into wholesale distribution of consumer products.

Outside of the parent company Ayala Corp., the ALI group by itself is a large mix of different companies engaged in allied businesses (land holding, construction, property development and management, hotel operations, industrial estate development, and infrastructure) as well as subsidiaries in theater management, food court operations, entertainment retailing, and information technology.

While these companies are majority controlled by ALI and are complementary in nature, Licuanan said this is not entirely the same for their affiliates wherein ALI has minority control. The Fil-Estate group dictates the operations of MRTC while the Dutch parent firm Makro has control over the store network’s local operations.

Aside from Makro and MRTC, ALI has a minority stake in shopping center operator Alabang Commercial Corp. and Lagoon Development Corp., and mixed-use property developer Cebu Holdings Inc.

ALI has, in fact, offered its stake in MRTC as part of its bid to purchase the 69.6-percent stake of Metro Pacific Corp. in Bonifacio Land Corp., the private developer of the Bonifacio Global City.

In early October, MPC, the flagship Philippine unit of Hong Kong conglomerate First Pacific, said it was ready to relinquish control over its biggest and most ambitious project – the Bonifacio Global City – as part of its ongoing process to address its balance sheet structure, particularly to pay off debts of about P12 billion.

MPC, however, rejected ALI’s offer and offered a counter-proposal for $200 million, which ALI, in turn, also turned down, reasoning that the appropriate valuation of MPC’s interest in BLC was considerably less than the said amount.