Razon-led infrastructure company buys 25% stake in Manila Water

February 3, 2020

Prime Metroline Holdings Inc., on behalf of a company to be incorporated, signed with Manila Water an agreement for the acquisition of 820 million common shares of Manila Water which represents a 25 percent stake in the Company at a price of P13 a share.

This was announced Monday in a press statement from Manila Water.

Ayala Corp. remains with a 38.6 percent stake following the transaction.

Manila Water shares were trading at P12.16 on Monday at the Philippine Stock Exchange.

''The entry of Prime, which is led by businessman Enrique Razon Jr., as a strategic investor to Manila Water is expected to bolster Manila Water’s ability to provide reliable, efficient and sustainable water and wastewater services in the East Zone and at the same time pursue growth initiatives both domestically and globally,'' the statement said.

''The Razon group brings with it its expansive global reach and business expertise; with operations in Asia Pacific, Latin America, Middle East and Africa, to Manila Water,'' it added.

Prime Metroline announced last November that Wawa Dam in Rizal secured approval for the project. The dam is expected to add 80 million liters per day to Metro Manila by 2021.   

''The placement brings ₱10.7 billion in additional equity capital for Manila Water and is expected to strengthen the company’s balance sheet and allow it to be more agile to pursue its long-term strategic initiatives,'' it added.

Manila Water and Maynilad came under fire from President Rodrigo Duterte for alleged onerous provisions in its two-decade concession agreement. The government will draft is a new concession agreement for the two water companies.

“Our partnership with the Razon group will result in clear synergies to achieve Manila Water’s long-term goal of providing sustainable water and wastewater services to our customers in the East Zone of Metro Manila and in the other markets we serve,” Fernando Zobel de Ayala, Manila Water chairman said.

“Our partnership combines our respective technical and management expertise. Looking beyond our domestic businesses, the extensive global experience of Mr. Razon through his port operations opens more opportunities for Manila Water to serve new markets,” he added. DMS