Metro Pacific to issue P50-million preferred shares

MANILA, Philippines - Metro Pacific Corp. (MPIC), the local flagship of Hong Kong-based conglomerate First Pacific Co. Ltd., will issue P50 million worth of preferred shares to Metro Pacific Holdings Inc. (MPHI).

In a disclosure to the Philippine Stock Exchange, MPIC said its board has approved the issuance of five billion Class A preferred shares in favor of MPHI at their par value of one centavo each.

Holders of Class A preferred shares are entitled to vote and receive preferential cash dividends at the rate of 10 percent per annum, which shall come from MPIC’s unrestricted retained earnings.

The dividends are cumulative from and after the issue date of the Class A preferred shares. The Class A preferred shares can not be convertible to any shares of stock of the company.

MPIC said its board likewise approved an equity fund raising exercise to support future acquisitions and widen its investor base.

To facilitate this exercise, MPIC’s board approved in principle the issuance of new common shares, the number and issue price of which will be finalized in due course and the listing of the same shares on the PSE.

Early this week, MPIC officials said they were eyeing to raise between $200 million and $300 million through a share offering. An international roadshow will be held in the middle of this month to drum up support for its planned share issuance.

The shares are targeted to be sold to institutional investors in Hong Kong, Singapore, the United Kingdom and United States.

First Pacific is reportedly willing to reduce its stake in MPIC to no less than 70 percent to boost liquidity of the local holding firm.

MPIC president Jose Ma. K. Lim earlier 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 controlling stake in utility firm Maynilad Water Services Inc., First Philippine Infrastructure Inc. (now known as Metro Pacific Tollways Corp.) and chain of leading hospitals.

Aside from healthcare, infrastructure and water, MPIC is exploring the possibility of investing in a solid waste management project that will require a capital outlay of around P2 billion.

MPIC is also keen on raising its stake in Citra Metro Manila tollways Corp., builder of the Skyway 2 project, a seven-kilometer toll road that will connect Bicutan to Alabang, from the current five percent to 30 percent.

The Skyway project is a joint venture between 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.

MPIC also hopes to complete the acquisition of the PLDT Beneficial Trust Fund’s 10.17-percent stake in power retailer Manila Electric Co. (Meralco) within the year.

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