Maynilad seeks foreign investors to join 2025 IPO
Concessionaire Maynilad Water Services Inc. is banking on foreign investors to chip in during its much-awaited stock market debut, which is scheduled for next year as it moves to beat an upcoming deadline and take advantage of better market conditions.
Speaking to reporters during a press briefing last week, Maynilad president and CEO Ramoncito Fernandez said they had appointed HSBC, Morgan Stanley and UBS as financial advisors for the initial public offering (IPO), which could happen either before or after the midterm elections next year.
“This is a major listing that will not be funded only by local investors; we really need a portion [from overseas investors],” Fernandez explained, adding they would begin processing their IPO application in the first quarter of 2025.
The concession agreement of Maynilad with the Philippine government, through the Metropolitan Waterworks and Sewerage System, requires it to offer at least 30 percent of its shares to the public.
Under the agreement, Maynilad, the largest private water concessionaire in terms of customer base, also needs to launch its IPO before January 2027.
Its East Zone counterpart, Manila Water Co. Inc., was listed in 2005.
Maynilad has yet to put a price on its IPO, although Bloomberg previously quoted sources as saying it could raise up to $1 billion.
Fernandez clarified talks with current stockholders about equal dilution, or the agreement among parties that equity ownership would be decreased fairly among themselves once additional shares are offered to the public, have yet to begin.
Maynilad is jointly owned by Metro Pacific Investments Corp. of tycoon Manuel Pangilinan, Consunji family-led DMCI Holdings Inc. and Japanese conglomerate Marubeni Corp.
“Marubeni wants to stay,” the CEO said. “In fact, they are the most sensitive in being diluted … Ideally, we want an equal dilution.”
Marubeni, which has interests in several other ventures in the Philippines, currently holds a 21.54-percent stake in Maynilad.
“They don’t want to dilute their board membership, and that is what they are most critical about,” Fernandez added.
Two Marubeni officials are currently part of Maynilad’s board of directors.
Fernandez earlier said they were also considering other fundraising activities, including debt and equity structures, to bankroll its capital expenditure worth up to P160 billion.
