MPIC allots $90 M for overseas toll road project

MANILA, Philippines - Infrastructure giant Metro Pacific Investments Corp. (MPIC) is spending as much as $90 million to expand its toll road business overseas with the acquisition of a minority stake in a toll road operator in Vietnam.

Ramoncito Fernandez, president of Metro Pacific Tollways Corp., said the company is spending approximately $86 to $90 million to acquire a stake in CII Bridges and Roads Investment Joint Stock Co. (CII B&R).

This is the second overseas venture of MPIC for its toll road business.

In a disclosure to the Philippine Stock Exchange (PSE), MPIC general counsel Jose Jesus Laurel said MPTC entered into an equity investment and financing transaction with Ho Chi Minh City Infrastructure Investment Joint Stock Co. (CII).

Laurel said the transaction would result in MPTC holding a significant minority equity interest equal to about 45 percent of the outstanding capital of CII B&R.

The transaction would be conducted through a combination of purchase of CII B&R secondary shares from CII and subscription to Vietnamese Dong (VND)-denominated bonds to be issued by CII that are exchangeable into secondary shares in CII B&R.

The company informed the Exchange that MPTC entered into a share purchase agreement with CII covering the purchase of 30 million shares of CII B&R at VND22,100 per share.

Likewise, MPTC also signed a bond subscription agreement with CII covering the issuance by CII of and the subscription to 1.02 million bonds each with a face value of VND1 million that are convertible to 56,666 million shares of CII B&R.

Shares of CII are being traded at the Ho Chi Minh Stock Exchange. It is engaged in infrastructure particularly roads and bridges, clean water production, industrial zone infrastructure, real estate, and equity investment.

MPIC and parent firm First Pacific Co. Ltd of Hong Kong first ventured into overseas toll road operations through a acquisition of a stake in Don Muang Tollway Public Co. Ltd. of Thailand.

First Pacific and MPIC invested P5.8 billion in November 2013 to acquire a 29.45 percent stake 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.

However, MPIC decided to acquire First Pacific’s 75 percent stake in FPM Infrastructure Holdings for  $101.25 million last June.

MPIC is looking at increasing its stake in a toll road operator in Thailand to about 50 percent in the first half of the year. 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.