Mla Water drops bid for Indon water utility

MANILA, Philippines - Ayala-led Manila Water Co. Inc. announced yesterday that it would not proceed with its plan of acquiring French firm Suez Environnement’s 51-percent stake in Indonesian water utility PT PAM Lyonnaise Jaya (PALYJA).

In a disclosure to the Philippine Stock Exchange (PSE) yesterday, Manila Water assistant corporate secretary Jhoel Raquedan said the company failed to get the approval of Suez’s partner Perusahaan Daerah Air Minum Daerah Khusus Ibukota Jakarta (PAM Jaya) for the share sale.

In October last year, Manila Water announced its plan to acquire the 51 percent held by Suez in PALYJA.

A share purchase agreement signed by Manila Water with Suez earlier provides that the acquisition requires government and regulatory approvals in Indonesia and other conditions.

Among the conditions that need to be fulfilled is the issuance by PAM Jaya of a written consent or confirmation of no objection to the transfer of shares of Suez.

After initially welcoming the bid of Manila Water, the local government of Indonesia apparently had a changed of heart and is now reportedly planning to operate the utility firm itself.

The share purchase agreement likewise provides that Manila Water and Suez may agree to assign the shares to the former’s subsidiary, Manila Water South Asia Holdings, Pte. Ltd.

Manila Water provides water and wastewater services for the East Zone

of the metropolis, which covers Makati, Mandaluyong, Pasig, Pateros, San Juan, Taguig, Marikina, and most parts of Manila and Quezon City, as well as Rizal.

The company also has projects in areas outside of the East Zone through its subsidiaries in Laguna, Pampanga, Boracay and Cebu.

Manila Water likewise has operations overseas.

In 2011, it acquired a 49 percent stake in the Thu Duc Water BOO Corp. in Vietnam.

Earlier, the firm said it is banking on expansion to grow its business.

Established in 1998, PALYJA provides clean water and services in Jakarta.