MANILA, Philippines - Conglomerate Ayala Corp. is acquiring an initial 49-percent stake in a Vietnamese firm that will undertake infrastructure projects in Southeast Asia’s new emerging market.
In a disclosure to the Philippine Stock Exchange, Ayala said it has an inked an agreement with Ho Chi Minh City Infrastructure Investment Joint Stock Co. (CII) and some other Vietnamese investors to form a joint venture, VinaPhil Technical Infrastructure Investment JSC, which will have an initial capitalization of around $43 million.
In April, Ayala acquired a 10-percent stake in CII, which is listed on the Ho Chi Minh Stock Exchange, concurrent with Manila Water Co. Inc.’s acquisition of a 47.35-percent interest in Kenh Dong Water Supply JSC.
Established in December 2001, CII is a leading player in the infrastructure sector in Vietnam with a solid track record in sourcing, implementing and operating infrastructure assets.
Ayala president and chief operating officer Fernando Zobel De Ayala said while the conglomerate “remains focused on developing infrastructure projects in the country, it believes that this investment provides the group strategic access to other infrastructure opportunities.”
“We are glad to be in partnership with CII, which is one of the most reputable infrastructure companies in Vietnam. This will put us in a good position to participate in Vietnam’s fast growing infrastructure sector,” Zobel said.
CII general director Le Quoc Binh, for his part, said: “We are pleased to have found a partner in Ayala Corp. which has a record for establishing strong long-term relationships. Furthermore, Ayala Corp’s experience in water and real estate infrastructure through its subsidiaries will be of help as other opportunities in these sectors arise.”
Ayala is one of the largest conglomerates in the Philippines with businesses in real estate, financial services, telecommunications, and a broad range of investments in water, electronics, automotive, international operations, and business process outsourcing. It has ventured into the power generation and transport infrastructure sectors to spur faster growth.
CII,meanwhile, has a portfolio of strategic infrastructure assets, including water treatment plants and toll roads serving Ho Chi Minh City and surrounding areas. This water company also holds a stake in Thu Duc Water BOO Corp., a water treatment company which is now 49-percent-owned by Manila Water.
In addition to water infrastructure, CII holds toll road concession agreements such as the 15.7-kilometer expansion of the existing Ha Noi Highway which connects the northeastern part of Ho Chi Minh City to Bien Hoa, an industrial center located in the southern part of Vietnam.
CII wants to invest further in new water infrastructure initiatives and is considering expansion into other types of infrastructure projects such as public transportation terminals.