MANILA, Philippines — Apart from rehabilitating the jam-packed Metro Rail Transit-3 (MRT-3), Japanese firm Sumitomo Corp. now has a new job to take part on extending and operating the Light Rail Transit Line 1 (LRT-1).
In a disclosure to the stock exchange on Friday, infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) said Sumitomo acquired a 34.9-percent stake in its subsidiary that has a 55-percent share in Light Rail Manila Corp. (LRMC), the consortium operating the 20.7-kilometer LRT-1 that runs from Baclaran in Manila to Roosevelt in Quezon City.
LRMC — a consortium composed of MPIC, Ayala-led AC Infrastructure Holdings Corp. and the local unit of Macquarie Investments Holdings Ltd. — has a 32-year concession to operate, maintain and extend LRT-1. The concession started in September 2015.
With the transaction, Sumitomo now holds a 19.2-percent stake in LRMC, MPIC said. Shares in MPIC rallied 2.12% to end the week at P2.89 each after the announcement.
"This investment by Sumitomo is a welcome illustration in their belief in the future of this project," Manuel V. Pangilinan, company chairman, said.
The government has also tapped Sumitomo for the rehabilitation of the overstretched MRT-3, the busiest train system in the Philippine capital that carries around 500,000 passengers a day. The Japanese company's entry to LRT-1, the oldest train line in Manila, comes at an opportune time when the company has just restarted work on the P64.9-billion LRT-1 Cavite extension project targeted finished by 2021.
The project, which started last year but was halted for a while during the Luzon lockdown that started March 17, aims to add 11.7 kilometers to the existing train line so that it extends to Bacoor, Cavite. The new stretch will add eight stations to the current 20 stations.
"Sumitomo is keen to share our 100 years-worth of global investment and operational experience," Eita Fujikawa, Sumitomo’s general manager for transportation systems, said.
"We are confident that our investment and expertise will provide the support the expanding Manila public transit infrastructure needs to grow, and to bring local communities even closer through the Cavite extension," Fujikawa added.
For his part, Juan Alfonso, LRMC president and chief executive, said: "Sumitomo’s investment will significantly contribute to the efficiency of our current operations and assist us as we continue heavy works on the Cavite Extension."