Despite the currently adverse market conditions, Maynilad Water Services Inc. is looking forward to a successful initial public offering (IPO) as it has already secured the commitment of cornerstone investors, although at a lower ceiling price.

“The market is bad, but we are putting in a very successful and incredible story,” Maynilad President and Chief Executive Officer (CEO) Ramoncito S. Fernandez said in an interview on the sidelines of a Shareholders’ Association of the Philippines (SharePHIL) event.

He noted that, “The progress is promising, and we will file the final prospectus by this Friday,” Oct. 3. It will identify who the cornerstone investors are and the size of their committed investments.

According to Fernandez, there are additional cornerstone investors, and not just the Manila-based Asian Development Bank (ADB) and the World Bank Group’s (WBG) private-sector arm International Finance Corp. (IFC), which Maynilad had identified in its latest draft prospectus filed with the Securities and Exchange Commission (SEC).

Maynilad will be lowering the IPO price ceiling to ₱15 per share, from the maximum indicative price of ₱20, as this is the preferred price of the institutional investors.

Based on the latest prospectus, IFC has agreed to participate as a cornerstone investor in the offer for an investment size of up to $100 million, at a subscription price of up to ₱15 per share.

On the other hand, Maynilad said the ADB is currently contemplating participating as a cornerstone investor in the IPO for a potential investment size of up to $145 million, also at a subscription price of up to ₱15 per share.

While the ADB has substantially completed its evaluation for its participation in the offer, it is still in the process of obtaining the approval of its board of directors.

Maynilad is offering a total of 2.29 billion shares for up to ₱20 per share, consisting of a primary offer of 1.66 billion new common shares, a preferential offer to First Pacific Co. of 24.9 million new shares, an upsize option of 354.7 million secondary shares of shares owned by existing shareholders, and an overallotment option of up to 249.05 million shares.

Proceeds from the offering of new shares will be used to fund Maynilad’s capital expenditure (capex) program for 2025 to 2026, which consists of three major pillars: water capex, wastewater capex, and customer service and information system projects capex. A portion of the proceeds may also be allocated for general corporate purposes.

According to Abacus Securities Corp., at the current exchange rate, the two multilateral institutions will own around ₱14.2 billion worth of stock, or over 40 percent of the offer, if priced at ₱15.

However, it noted that, “Domestic financial institutions will still have to pick up some of the slack to reduce the overhang on listing day.”

Reyes Tacandong & Co. senior adviser Jonathan Ravelas said that IFC and the ADB’s backing of Maynilad’s IPO at ₱15 per share “is a strong vote of confidence. It signals they see long-term value in water infrastructure and trust the governance.”

“The IFC/ADB cornerstone investment is good news, but domestic institutions will need to do heavy lifting themselves for Maynilad to get a pop on its first day,” Abacus said, adding that it believes there will be demand from local funds.