Metro Pacific Investment Holdings Company (MPIC) is planning to voluntarily delist from the Philippine Stock Exchange after a P48.4 billion tender offer by a consortium of its significant shareholders and Mitsui of Japan.

In a disclosure to the Philippine Stock Exchange, MPIC said it has received the Tender Offer Notice from a consortium consisting of Metro Pacific Holdings, Inc. (MPHI), GT Capital Holdings, Inc., Mit-Pacific Infrastructure Holdings, Inc. (MPIH), and MIG Holdings Incorporated.

MPHI is a member of the First Pacific Group owning 46.1 percent of MPIC while MPIH is a joint venture of Mitsui and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development.

MPHI is a member of the First Pacific Group owning 46.1 percent of MPIC while MPIH is a joint venture of Mitsui and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development.

GT Capital is the investment arm of the Ty family which recently exchanged its power investments for a 17.1 percent stake in MPIC while MIG is a management investment group led by First Pacific CEO and MPIC Chairman Manuel V. Pangilinan.

First Pacific CEO & MPIC Chairman Manuel V. Pangilinan

The consortium said it intends to make a tender offer for all common shares of MPIC that they do not own with a view to taking MPIC private through a voluntary delisting process.

The tender offer values MPIC at P133 billion in equity value. The Bidders will offer to acquire the Tender Offer Shares at P4.63 each on an all-cash basis, which represents a 22 percent premium over the one-year Volume Weighted Average Price of MPIC’s common shares.

“The Bidders stated in the Tender Offer Notice that they believe that the Tender Offer and voluntary delisting of MPIC will allow existing shareholders to sell their common shares and realize their investment, in cash, at a premium to the current trading price of the common shares,” the firm said.

It added that, “the Bidders informed MPIC that to comply with the voluntary delisting requirements of the PSE, an independent valuation report and fairness opinion shall be rendered to support the Tender Offer Price.”

In a disclosure to the the Hong Kong Stock Exchange, First Pacific said “The Bidders feel that the intrinsic value of MPIC’s core investments in infrastructure in the Philippines has not been fully reflected in MPIC’s share price for some time.”

“The tender offer and successful delisting will allow MPIC’s minority shareholders to realize a significant premium over historical share prices of MPIC,” it added.

The firm noted that, “At the same time, a delisted MPIC will be better aligned with the objectives of the Bidders to continue investing in long-term infrastructure projects supporting sustainable economic growth in the Philippines.”

For Mitsui, it is a unique opportunity to acquire a portfolio of assets encompassing core infrastructure such as power, water, and tollways in a market that is expected to enjoy sustained economic growth in the years ahead.

Mitsui’s leading capabilities and expertise in the global infrastructure business will further contribute to solidifying MPIC’s unparalleled offerings and position in the Philippines.
First Pacific and GT Capital warmly welcome the long-term value and synergies offered by the strategic partnership with Mitsui.

Under the tender offer, First Pacific, through its Philippine affiliate MPHI, would spend approximately $90 million to increase its stake in MPIC by as much as 3.8 percent, using internal financial resources.

GT Capital would increase its stake to a maximum of 20 percent by paying a consideration of approximately $70 million in the transaction for the residual 2.9 percent, funded through internal cash.

Mit-Pacific would buy up to 20 percent of MPIC under the tender offer, becoming a shareholder for the first time in a new strategic initiative.

The Pangilinan firm would buy up to 10 percent. Participation of the management investment group is expected to closely align the interests of management with shareholders of the newly private MPIC.

"We envision this transaction will release value in MPIC for the benefit of our shareholders and we look forward to working with our partners in MPIC for the long term, undistracted by the need to focus on short-term – often quarterly – goals that public ownership often imposes,” said First Pacific Executive Director Christopher H. Young.

GT Capital Chief Financial Officer Francisco H. Suarez, Jr. said “We are pleased to participate in this tender offer to increase our current stake in Metro Pacific. This further diversifies GT Capital’s core portfolio. Our participation aligns with our mission of creating further value for our stakeholders and contributing to nation-building.”

“By combining MPIC's business foundation with Mitsui's long-standing capabilities and experience in the global infrastructure business, we will contribute to the energy transition in the Philippines.” said Mitsui’s General Manager of Division I (Asia), Infrastructure Projects Business Unit Takehiko Ainoya.

He added that, “We will support MPIC’s business development and create collaborative projects by leveraging our comprehensive capabilities in the digital field and other areas, thereby enhancing MPIC's corporate value.”

MPIC said a special meeting of its Board of Directors of MPIC was convened on April 26, 2023 during which the board, including all four independent directors, unanimously approved a resolution authorizing the filing of an application for voluntary delisting with the PSE, subject to compliance with the Amended Voluntary Delisting Rules of the PSE.

To comply with the voluntary delisting requirements of the PSE, the Tendered Shares together with the Excluded Shares should constitute at least 95 percent of the total issued and outstanding capital stock of MPIC, or such percentage as the PSE may allow to effect the voluntary delisting of MPIC from the Main Board of the PSE.

The Tender Offer Notice from the Bidders states that it is their intention to delist MPIC from the PSE and as such, the Bidders will not accept any Tendered Shares unless the threshold for voluntary delisting is achieved or an exemptive relief is obtained from the PSE.