Metro Pacific Investments Corp. (MPIC) is aiming to seal a deal to sell about 20 percent of subsidiary Metro Pacific Tollways Corp. to a foreign strategic investor in the next two months.
In an interview, MPIC Chairman, President and CEO Manuel V. Pangilinan said they have whittled the number of potential investors to just one. A fifth of MPTC will be sold via private placement with negotiations “down to the short strokes.”
The planned sale of a stake in MPTC is part of MPIC’s plan to raise ₱30 billion to ₱50 billion to pare down debts with the current portion amounting to ₱64.99 billion, of which obligations of MPTC account for about half.
MPIC Chief Finance, Risk, and Sustainability Officer Chaye Cabal-Revilla said the proceeds from the private placement would be enough to pay off all MPTC debts.
She noted that the settlement of MPTC’s debts would facilitate its planned merger with SMC Tollways Corp. since most of its debts are at the parent company (San Miguel Corp.) level instead of the subsidiary.
Pangilinan said earlier that they have deferred merger discussions with SMC because “MPTC is raising money. We have significant debts. So, once we have achieved that, then we can resume the discussion.”
MPTC is the holding company for the North Luzon Expressway (NLEX), the Subic-Clark-Tarlac Expressway (SCTEX), the Manila-Cavite Toll Expressway (CAVITEX), the Cavite-Laguna Expressway (CALAX), the Cebu-Cordova Link Expressway (CCLEX), and the NLEX Connector.
SMC Tollways, meanwhile, operates the South Luzon Expressway, the Skyway Stage 3, the Southern Tagalog Arterial Road (STAR), the NAIA Expressway, and the Tarlac-Pangasinan-La Union Expressway (TPLEX).
Meanwhile, Pangilinan said they are not planning an initial public offering of MPTC this year since they focus on the IPO of Maynilad Water Services Inc.
He also noted earlier that the public listing of MPTC will have to come after Japan’s Mitsui completes the conversion of its stake in MPIC to MPTC.
In September 2024, MPIC entered into a framework agreement to buy back 4.58 million common shares or 50 percent of the common shares held by Mit-Pacific — a joint venture between Mitsui & Co. Ltd. and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development — in the company.
Under the deal, MPIC will buy back 4.577 billion common shares owned by Mit-Pacific, representing 7.3 percent of MPIC. This will cut Mit-Pacific’s stake in MPIC to 7.8 percent, while MPIC’s shares in the company will increase to 49.9 percent.
MPIC also agreed to issue exchangeable bonds worth P11.9 billion to Mit-Pacific. The bonds can be converted into 1.495 billion common shares in MPTC.
If Mit-Pacific opts to exchange the bonds into MPTC shares, it will receive a 6.6-percent interest in the tollways company and be entitled to a seat on the MPTC board. MPIC’s stake in MPTC will then drop to 93.6 percent.
“The transaction would deepen strategic cooperation between MPIC and Mit-Pacific at operational level, whilst maintaining collaboration across the group,” said MPIC’s parent company First Pacific Co. Ltd.