MPIC still keen on selling up to 30% of tollways unit
Hong Kong—Metro Pacific Investments Corp. (MPIC) is still keen on letting go of up to 30 percent of its interest in its tollways business. This is meant to help slash mounting debt that has already ballooned to P200 billion.
When asked about updates on its merger talks with another giant, San Miguel Corp. (SMC), MPIC chair Manuel V. Pangilinan said that it was put off the table given Metro Pacific Tollways Corp.’s (MPTC) rising debt stock.
He reiterated that business discussions with the Ramon Ang-led group would only become “serious” once they fix the tollways’ financial health.
“For now, the main focus is managing the tollways better and strengthening the balance sheet,” Pangilinan told reporters.
“There’s nothing on the IPO (initial public offering) scenario because it’s not ideal for MPTC these days. We have to look at either a strategic partner, one who has invested in tollways, or a financial partner. So, coupled with the bond issuance, there will be an equity raising exercise, a private placement,” he said.
The conglomerate’s plan to sell shares in the toll road operator was first floated earlier this year. But Pangilinan dialed down on this as the group hoped to explore new options to cut debt.
Sought for more details, Chaye Cabal-Revilla, MPIC chief financial, risk and sustainability officer, said the group was eyeing two levels of private placement. These involve its units in Indonesia and the Philippines.
According to Revilla, potential partners can purchase a 20 percent to 30 percent stake in each of the units.
However, she said this would still “depend on the valuation,” as well as the requirement to team up with “like-minded organizations in terms of ‘fit-and-click’ to the group.”
Revilla also said a previous transaction did not push through due to “geopolitical issues.”
Addressing its debt issue is not only crucial to pursuing a partnership with SMC, as wiping them out will also allow the group to go public.
“Watch this space. I think we will fix the problem and, once we’ve done that, then we should do an IPO,” said MPTC president and chief executive officer Gilbert Santa Maria.
