SMC seen to hike stake in Citra unit to 51%

MANILA, Philippines - San Miguel Corp. is likely to exercise its option to raise its stake in an Indonesian-backed company that controls Citra Metro Manila Tollways Corp. , the concession holder and operator of the 15-kilometer elevated Skyway tollroad project.

San Miguel recently forged a deal to acquire a 46-percent stake in Atlantic Aurum Inc., a unit of the Citra Group of Indonesia which owns a controlling interest in the Skyway project that runs from Makati to Alabang.

The food to infrastructure conglomerate has an option to increase its stake in Atlantic Aurum to 51 percent at a later date.

 “We can exercise our option anytime documentation is ready. But we’re not in a rush to do that. Citra doesn’t need the money,” SMC president Ramon S. Ang said.

 San Miguel and the Citra Group are currently studying a plan to acquire a majority stake in the 42-kilometer Southern Tagalog Arterial Road in Batangas, operated by the STAR Tollway Group led by Hong Kong-based Cypress Tree Ltd.

The move is part of a strategy to forge a powerhouse consortium that can take on big-ticket infrastructure projects under the flagship public-private partnership (PPP) program of the Aquino Administration.

Citra and San Miguel received a proposal from the Star Tollways Group to expand the tollroad in Batangas province south of the capital by widening the existing two lanes to four lanes.

Targeted to begin in the middle of 2012, the STAR tollroad expansion project is expected to be completed in 24 months at a cost of P2.5 billion.

Metro Pacific Tollways Corp. owns about two percent of CMMTC and has long been wanting to raise its stake to at least a third.

San Miguel has been eyeing toll roads as a strategic component in its push to become a major infrastructure player in the country.

SMC owns a minority interest in the Tarlac-Pangasinan-La Union Expressway and North Luzon East Expressway, which starts in Quezon City and will eventually stretch to Tuguegarao in Cagayan province.

To ensure continued growth, CMMTC has proposed to build the third and fourth phases of the Skyway project.

Skyway Stage 3, which will cost around P24 billion, will connect the North and South Expressways while stage 4, called Metro Manila Expressway, costs about P28 billion,

Phase 4 will involve the construction of a 57-kilometer grade expressway that will link the Skyway at the Food Terminal Inc. with the North at San Jose Del Monte, passing through C6 in RTAguig, Ortigas Ave., Marcos Highway, San Mateo, Montalban.