[ manilastandardtoday.com ] August 17-18, 2008
By Jenniffer B. Austria
Metro Pacific Investments Corp., the local unit of Hong Kong’s First Pacific Investments Co., plans to borrow P6.7 billion to partially finance acquisition of a majority interest in First Philippine Infrastructure Inc. from the Lopez group.
Metro Pacific chairman Manuel Pangilinan said in a press briefing that the company was in talks with local banks for the funding package.
He said Metro Pacific would raise the balance of $120 million through the sale of additional shares to parent firm First Pacific or third party equity.
Benpres Holdings Corp. and First Philippine Holdings Corp., owned by the Lopez group, earlier agreed to sell their combined stake in First Philippine Infrastructure for P12.2 billion.
First Philippine Infrastructure owns 100 percent of First Philippine Infrastructure Development Corp., which in turn owns 67.1 percent of Manila North Tollways Corp., operator of North Luzon Expressway, and 46 percent of Tollways Management Corp., which maintains the toll road.
Pangilinan said he expected the toll road business to contribute P6 billion in revenues to Metro Pacific next year.
Traffic in the expressway last year reached 146,000 vehicles a day, generating a daily revenue of P15 million.
Metro Pacific and the Lopez group expected to close the deal by November. Metro Pacific will start consolidating the newly acquired tollways business in December.
Metro Pacific is in an expansion mode, acquiring interests in Maynilad Water Services Inc., Makati Medical Center and Davao Doctors Hospital.
The company has shifted its strategy by funding its acquisitions though equity and not mainly borrowings.
“I think days of the past when we were funding acquisitions with fair amount of debt is over. We do not want to repeat that experience in the past,” Pangilinan said.
He added that with good assets in Metro Pacific fold, it might be appropriate now to raise third party equity.
Metro Pacific reported a core net income of P24.5 million in the first half of the year, a reversal from restated core net loss of P43.9 million year-on-year.
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