Metro Pacific to offer more shares to public

MANILA, Philippines - Metro Pacific Investments Corp. (MPIC), the local flagship of Hong Kong-based conglomerate First Pacific Co. Ltd., is planning to undertake either a primary or secondary offering of shares to increase its public float.

At the sidelines of the company’s annual stockholders’ meeting yesterday, MPIC chairman Manuel V. Pangilinan said the company is hoping to boost its public float to 25 percent through the sale of primary or secondary shares possibly in August or September this year.

To facilitate the sale of shares, the company is raising its capitalization to P31.55 billion from P21.55 billion.

Pangilinan noted that the local market has been showing signs of strength and stability in spite of the global recession.

He said First Pacific is willing to reduce its stake in MPIC to no less than 70 or 75 percent to boost liquidity of the local holding firm. “Liquidity is very small.   So we’re hoping we can increase the public float,” Pangilinan said.

MPIC president Jose Ma. K. Lim said there has been increasing investors’ interest in the company following its transformation into a major infrastructure company through a string of purchases which include a majority stake in utility firm Maynilad Water Services Inc., First Philippine Infrastructure Inc. (now known as Metro Pacific Tollways Corp. and hospitals.

“We were in Singapore last week and there has been strong interest in the company,” Lim said.

At the same time, Lim announced that MPIC is exploring the possibility of investing in a solid waste management project that will require the group to shell out P2 billion. “There are ongoing discussions to secure a 25-year government contract to operate and maintain 100-hectare sanitary landfill in Bulacan,” he said.

Pangilinan said the group, through MPTC, has already submitted an offer to enlarge its participation in the Skyway 2 project, a seven-kilometer tollroad that will connect Bicutan to Alabang. The group is eyeing to increase its stake to 30 percent from the existing five percent.

MPIC had long been interested in increasing its investment in Citra Metro Manila Tollways Corp. (CMMTC) since 2006 but the Indonesian group that controls the Skyway could not decide if it wanted to retain control or to sell.

The Skyway project is a joint venture between the Citra Marga Nusaphala Persada, a publicly-listed toll operator in Indonesia, and the state-controlled Philippine National Construction Corp. The first phase of the 35-kilometer elevated toll road, with a cost of more than $500 million, was built along the South Luzon Expressway.

Lim said MPIC also hopes to complete the acquisition of the PLDT Beneficial Trust Fund’s 10.17-percent stake in Meralco this month. “Discussions concerning the terms and conditions to be agreed by both parties are ongoing for the acquisition by MPIC of BTF’s investment in Meralco in exchange for new shares of MPIC, he said.  

 “Meralco is the largest distributor of electricity in the Philippines and is a powerhouse yet to be fully utilized. With the magnitude of its franchise areas, business networks and diverse customer base, it is MPIC’s intention to be a strategic shareholder with appropriate board and management participation,” Lim said.

Lim said the group, through Maynilad, filed yesterday with the Manila Waterworks Sewerage System a 15-year extension of its concession contract – which is set to expire in 2022. An extension of the concession agreement will allow Maynilad to accelerate and raise the overall capex program over the extended life of the concession, and allow more flexibility to mitigate tariff adjustments in the future.

Following its strong performance last year, MPIC is upgrading its full-year income target which was earlier set at P1.2 billion. Last year, the company reported a core net income of P347 million or an increase of more than 10 times the P32.3 million recorded in 2007.