By JAMES A. LOYOLA
Manila Water Company, the beleaguered water utility controlled by the Ayala group, is planning to issue shares equivalent to about 30 percent of its capital and worth at least ₱9 billion in exchange for “cash, properties, or assets…”
Prior to this announcement, MWC had asked the Philippine Stock Exchange to suspend the trading of its shares yesterday until 10 a.m. of Monday next week.
MWC said this isi “In view of material events that could reasonably be expected to occur from (yesterday) until prior to the start of trading on Monday, February 3, 2020.”
In a subsequent disclosure, the firm said its board of directors has approved the amendments to its Articles of Incorporation to increase its authorized capital stock to ₱4.4 billion from ₱3.5 billion through the addition of 900 million common shares.
It added that the Board authorized the issuance of the 900 million shares “for cash, properties, or assets to carry out” the corporate purposes of the company as approved by its Board of Directors.
The firm has total outstanding capital amounting to 2.06 billion shares of which 2.03 billion are listed. The 900 million shares are equivalent to almost 45 percent of its current outstanding capital and about 30 percent of its capital after the issuance.
MWC said the minimum selling price of these shares will be at ₱10.00 each. The firm’s shares last closed at ₱12.16 apiece.
President Duterte has threatened a government takeover of the Manila Water concession over a portion of Metro Manila allegedly due to onerous provisions in the contract.
This developed after an arbitration tribunal ruled in favor of Metro Manila’s two water concessionaires and found government liable for its failure to allow the concessionaires to raise water rates to recoup investments.