While still ironing out some kinks, Maynilad Water Services Inc. is committed to launching its initial public offering (IPO), estimated at $1 billion, within 2025, and will file its application with regulators by the first quarter.

“Yes, we are poised to list next year. Our target is to be prepared for two possible dates: before the elections—April or after the elections—July,” Maynilad President and CEO Ramoncito Fernandez said in an interview.

He added, “Our plan is to be push-button ready, so we are now pushing our team to apply by the first quarter of next year.” Maynilad is the water concessionaire for the West Zone of Metro Manila.

While the size and value of the IPO have yet to be finalized, Fernandez pointed out that their commitment is evident: “The fact of the matter is that we have already appointed three financial advisors: HSBC, Morgan Stanley, and UBS.”

Given its size, the bulk of the IPO shares will be offered to overseas investors. While its franchise requires 20 percent public ownership, Fernandez said Maynilad would be “happy if it [were] bigger.”

However, Fernandez said there is also some “sensitivity” among its existing shareholders, particularly Japanese partner Marubeni Corporation, regarding the dilution of their stake due to the IPO. Metro Pacific Investments Corporation and DMCI Holdings Inc. are also partners in the concession.

“Marubeni wants to stay. In fact, they are very sensitive to being diluted. They are the most sensitive, actually, to being diluted. We have not agreed yet on whether it will be equal dilution for all three shareholders, but, ideally, it should be equal," he noted.

“But [Marubeni] doesn’t want to dilute its board membership. That is what they are most critical about. Of course, they want to consolidate their financials,” said Fernandez.

In the meantime, Maynilad is planning to fund its P40 billion capital expenditures next year through a combination of debt instruments, bank loans, and internally generated funds.

Fernandez said these options are all available to the company if its IPO does not push through or if it is conducted later in 2025.

While the firm is ready to launch its IPO as early as next year, Fernandez said it will depend on whether market conditions are favorable and on the valuation.

He said that, since their programmed capital expenditures next year will amount to P25 billion to P40 billion, they will need to raise funding of about P25 billion to P35 billion.

“We will have to study the most efficient way to raise funds next year because we still have borrowing capacity… We will have to go for the more efficient [or cheaper] way to raise funds,” he said.