MANILA, Philippines - Metro Pacific tollways unit, the Manila North Tollways Corp. (MNTC), has obtained an unsecured P1-billion fixed rate loan from two insurance companies that will enable the country’s leading tollway firm to bankroll its 2012 expansion projects.
The financing facility granted by The Insular Life Assurance Co. Ltd. (InsularLife) and the Philippine American Life and General Insurance Co. (PhilamLife) has a trend-setting 15-year tenor, the first to be seen in the country.
The Insular Investment & Trust Corp. is the lead arranger.
The loan agreement provides for two bullet repayment tranches of P500 million on the 10th and 15th year of the loan repayment period.
The loan approval is another big show of confidence by the financing communitys in MNTC’s long-term financial stability, particularly as builder, manager and concessionaire of the 94-kilometer North Luzon Expressway (NLEX).
Earlier in the year, the MNTC sealed a P10.6-billion unsecured loan with major local creditors, the proceeds of which were allocated for debt refinancing and execution of its expansion plans. The loan signaled the complete transformation of MNTC’s financing regime from a limited-recourse project finance to corporate finance.
The new loans extended by InsularLife and PhilamLife further extended the financing tenor.
“This is MNTC’s first 15-year loan transaction,” Rodrigo E. Franco, MNTC president, said, adding “and what is remarkable is that the facility is unsecured-an unmistakable sign of the solid confidence of the financing community in MNTC’s stability even in the long term.”
Ronnie Alcantara, president of Insular Investment & Trust Corp., said “the recently concluded P1-billion MNTC term loan facility was a breakthrough deal as it established a 15-year benchmark for a private sector loan facility.”
The MNTC will integrate the operations of the NLEX and SCTEX following the signing of the latter’s concession agreement with the Bases Conversion and Development Authority. (BCDA). With the signing of the SCTEX agreement, motorists will soon enjoy the benefits of integration in the form of seamless travel between the NLEX and SCTEX.
The MNTC has also set in motion its NLEX phase 2 expansion program involving the construction of vital linkages to major thoroughfares in Metro Manila, introducing the concept of “urban expressways” which proved popular in many capitals of Europe.
Among these projected secondary tollways is the NLEX Harbor Link, linking the NLEX to Manila’s Port Area via another tollway connecting the NLEX main to the newly built cloverleaf junction in Valenzuela City.
This expressway link is expected to significantly speed up and reduce the cost of transporting cargo from Central and Northern Luzon to the North Harbor, the domestic port complex of Metro Manila.
The NLEX Harbor Link will be made up of two parts: Segment 9 and Segment 10, two components of MNTC’s ambitious NLEX phase 2 project, which is designed to make the expressway more accessible to motorists.
Segment 9, measuring 2.42 kilometers long, will link the NLEX to McArthur Highway, the old route to Central and Northern Luzon. When completed, this road will ease traffic at the NLEX’s Valenzuela interchange, help decongest the Balintawak-Cubao stretch of Epifanio delos Santos Avenue (EDSA), and is expected to spur the development of Metro Manila’s flood-prone Camanava (Caloocan, Malabon, Navotas and Valenzuela) area.
Segment 10, on the other hand, will be 5.65 kilometers long and will extend from Segment 9’s McArthur Highway interchange to Letre in Malabon, all the way to the North Harbor. Aptly nicknamed “The Port Connector,” this segment, which will be mostly an elevated expressway, will cater mainly to port traffic.
In June last year, the MNTC opened Segment 8.1, also called the NLEX Mindanao Avenue Link, a 2.7-kilometer expressway that provides motorists with additional entry and exit ramps to the NLEX.