First Pac may hike stake in Thai toll firm

MANILA, Philippines - The tandem of Hong Kong-based First Pacific Co. Ltd. and Philippine infrastructure giant Metro Pacific Investments Corp. (MPIC) is looking at increasing its stake in a toll road operator in Thailand.

Metro Pacific Tollways Corp. president and chief executive officer Ramoncito Fernandez said FPM Infrastructure Holdings Ltd. is studying options to raise its 29.45 percent interest in Don Muang Tollway Public Co. Ltd.

“Hopefully if there are available shares, we would like to invest more in that road,” he stressed.

Fernandez pointed out that the company is bullish about the prospects of its investments in Thailand with the impending revival of the Don Muang airport.

DMT operates a 21.9-kilometer six-lane elevated toll road stretching from Din Daeng in central Bangkok past Don Muang Airport and on to the National Monument in the north of the capital under a 27-year concession ending in 2034.

Traffic on the toll road has risen 10 percent in the year since budget airlines began relocating to the airport in October 2012. Traffic averaged 77,000 vehicles per day on the original toll road in the first nine months of last year.

Further growth is seen as a result of population and economic growth in Bangkok and the full reopening of Don Muang Airport’s Terminal 2 in 2016.

“It’s a good road and will be actually growing specifically once the Don Muang airport is once again revived for tourist arrivals. We have information that the airport of Thailand in Bangkok is already starting to be full,” he said.

In November, First Pacific and MPIC invested P5.8 billion to acquire a 29.45 percent stake in DMT. FPM Infrastructure Holdings is 75 percent owned by First Pacific and 25 percent owned by MPIC.

First Pacific spent P4.4 billion for a 26.2 percent stake in the tollroad operator while MPIC invested P1.4 billion for a 3.25 percent interest in DMT.

The vendor of the toll road stake is a 50-50 joint venture between Bank of Tokyo-Mitsubishi UFJ and South East Asian Strategic Assets Fund. Other major shareholders of DMT include the Phanichewa Group with 37.1 percent and Thailand ’s Ministry of Finance with 25.1 percent.

Fernandez said talks with First Pacific are underway to finalize the structure of investments in the region.

“We’re still talking to First Pacific to finalize the structures. Originally First Pacific together with us wanted to be co-investors in our foreign investments. That’s the general direction, but there are discussions on how to restructure or how to move forward so we can invest more in regional projects,” he said.

First Pacific and MPIC are also looking at participating in the first public private partnership (PPP) project in Vietnam involving a $750 million Dau Giay-Phan Thiet motorway being undertaken by the Vietnamese government and the World Bank as well as private partner Bitexco Group.

The 100-kilometer four-lane Dau Giay-Phan Thiet motorway connecting the key southern cities of Ho Chi Minh City and Phan Thiet is a critical link in the national north-south transport route.

The Bitexco Group would hold 60 percent equity in the project while the rest would be contributed by the government and other private investors. The shareholders would be given a 30-year concession.