MPIC, DMCI willing to sell 20% Maynilad stake to Marubeni

MANILA, Philippines - Infrastructure firm Metro Pacific Investments Corp. and DMCI Holdings Inc. yesterday said they are willing to divest a combined 20 percent stake in West Zone water concessionaire Maynilad Water Services Inc. to Japanese trading giant Marubeni Corp. and that a deal may be signed shortly.

On the sidelines of the Euromoney Philippine Investment Forum yesterday, Metro Pacific president Joey Lim said discussions between the Maynilad consortium and Marubeni are now at an “advanced stage”.

Lim said a foreign strategic partner would provide Maynilad with the technology know-how and financial muscle to boost the local water firm’s expansion initiatives.

DMCI president Isidro Consunji said the deal, when completed, would allow Maynilad access to cheeper source of funding. “We may borrow loans for as low as one percent interest a month,” he said.

Consunji said his group is willing to unload 12 percent of its 45 percent stake in Maynilad. Metro Pacific, which owns 55 percent of the water firm, may likely trim its holdings by around eight percent.

He said the money to be raised from the divestment would be used to fund waste water projects.

Maynilad plans to spend around P50 billion over the next five years or until 2017 to improve and expand water services. It aims to widen wastewater coverage from the current eight percent to 28 percent in five years.   The figure should rise to 100 percent by the end of the concession period in 2037.

Maynilad is the West Zone water utility concessionaire.

Maynilad’s concession area is composed of the cities of Manila (all but portions of San Andres and Sta. Ana), Quezon City (West of San Juan River, West Avenue, EDSA, Congressional, Mindanao Avenue, the Northern part starting from the districts of the Holy Spirit and Batasan Hills), Makati (west of South Luzon Expressway) Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas and Malabon, all in Metro Manila, Cavite City and the towns of Bacoor, Imus, Kawit, Noveleta and Rosario, all in Cavite province.