Aboitiz more than double capex to P77 billion

By James A. Loyola

Aboitiz Equity Ventures (AEV), the investment arm of the Aboitiz Group, is planning a capital expenditure (capex) budget of P77 billion this year — more than double the P35 billion spent in 2017.

In an interview, AEV Chief Finance Officer Manuel O. Lozano said “the reason is, part of it is last year we were already targeting P50 billion. We didn't spend all of it so some of our projects were carried over.”

He added that they have also increased the capex budget this year because they have started some projects such as the Dinginin coal-fired power plant.

“About P60 billion of the capex is for power (Aboitiz Power Corporation). The rest, there are three that are more or less the same from last year, cement (Republic Cement) and land (AboitizLand), which will be about P4 billion to P5 billion each. And then the bank will have a capex also,” he said.

Lozano said that, for the power projects, all of these already have project debt, “and then a lot of the cash that we have for the year was set aside for our equity contribution. So the power side is all funded.”

Meanwhile, for the Davao bulk water project through Apo Agua, AEV has already set aside the equity portion of the P13-billion project cost and is currently finalizing the 70 percent project financing.

“Actually, we have been talking to the banks already for a long time. They are just waiting until we can finalize it. Until we finish all the permits. Now that we're on the tail-end, hopefully within the next two to three months we get that already in place,” said Lozano.

The Aboitiz Group’s first infrastructure venture, Apo Agua Infrastructura, Inc., is a bulk water project that will provide Davao City with 300 million liters per day.

Apo Agua, a joint venture between AEV and J.V. Angeles Construction Corporation, had previously signed an agreement with the Davao City Water District to build one of the country’s largest private bulk water supply projects.

Upon completion, the facility will have a capacity of 300 million liters per day of potable water sourced from the Tamugan River to benefit Davao City’s one million residents.