MPIC chairman Manuel V. Pangilinan said the company has to shell out P3 billion to finance its bid for Maynilad and P500 million to improve the facilities of Makati Medical Center. Another P500 million will be used to bankroll the real estate development projects of Landco.
MPIC is 76 percent owned by the First Pacific Group of Hong Kong, the parent company of Metro Pacific. MPIC was formed to continue the expansion of Metro Pacific’s real estate business and raise new capital for planned investments in infrastructure, power generation and consumer foods businesses.
The establishment of MPIC is in line with the reorganization undertaken by Metro Pacific in line with efforts to sustain long-term growth. MPIC will focus on infrastructure, power generation, water and consumer products businesses.
The recapitalization plan marks a rebirth for the company and paves the way for it to eventually become "a significant participant in key areas of the Philippine economy once again" after having successfully cut its debt to only P732.4 million from a high of P11.7 billion in 2001.
The reorganization plan also calls for MPIC to offer its shares for all the outstanding shares of Metro Pacific on a one-for-one basis.
At the close of this stage, MPIC will own 87 percent of Landco and 100 percent of Metro Pacific which shall continue to exist as an unlisted corporate entity and own shipping firm Negros Navigation Co. and certain other assets.
The third and final stage of the plan involves the implementation by MPIC of a rights issue to raise about P2.7 billion. Upon completion of the rights issue, MPIC will have a total capital of P4.5 billion, excluding any net profits realized this year in the interim. It shall also be debt-free at the parent level.