The news of the purchase of PrimeWater Infrastructure Corp. by billionaire Lucio L. Co in December of the past year spooked me, coming as it did while I was focused on the continuing downward spin of the equities market and the weakening of the local currency.

Yes, Virginia, the acquisition—lock, stock, and barrel—was announced while I was practically sleeping. I must admit I let my guard down following the disclosure by industrialist Manuel V. “MVP” Pangilinan that his firm was in initial negotiations with the owners of the beleaguered PrimeWater for a possible acquisition.

It was an affirmation, despite the vehement denial of a company official, of my earlier piece stating that MVP was interested in PrimeWater. Slack got the better of me.

Up until this writing, nothing has been said regarding the cost of the acquisition, which was brokered successfully by former Deputy National Treasurer and current AG&P President Roberto Juanchito “Jojo” Dispo. A former president of First Metro Investment Corp., Jojo is an advisor to the board of directors of Philippine Bank of Communications and Cosco Capital, both owned and controlled by Mr. Co.

Word and assessments circulating in the banking corridors indicate that the purchase price is over and above the earlier estimate of ₱30 billion, taking into account PrimeWater’s concession service areas, assets worth ₱40 billion, and profitability, with net income amounting to ₱1.34 billion as of the end of 2024.

From what I heard, there was a bit of a “premium,” despite millions of pesos worth of unpaid bills with its local water district partners and an ongoing investigation ordered by the President arising from consumer complaints—all citing the sheer expanse of the Villar-owned water utility firm’s concession service areas.

PrimeWater serves a vast network across the country, from Metro Manila to Calabarzon, and into the Visayas and Mindanao regions, in partnership with more than 70 local water districts. It also provides water and septage management for its sister company, real estate developer Camella Homes.

No, Virginia, it was not a fire sale; rather, it was “fairly valued.” And definitely, it was an opportune time for the Villars to lighten their load. As for the buyer? The utility firm is a solid addition to the growing business empire of Mr. Co.

The latest I’ve heard from the banking alleys is that the transaction will finally be consummated through a mix of cash and debt restructuring, delivered in tranches.

“From a purely theoretical and high-level perspective, individuals and groups of Lucio Co’s stature are generally associated with substantial financial capacity and access to capital—not just through personal wealth, but through banking relationships, institutional partners, and structured financing options,” explained an A1 but muted market source.

Having the financial capacity to fund the transaction is altogether different from the intent. However, the ability to fund a transaction does not automatically mean a deal will be pursued or structured as a full cash purchase.

Large acquisitions are rarely “all-cash” decisions. Even for well-capitalized firms—all things considered, including operational and regulatory compliance—transactions of this scale are typically evaluated using a mix of strategic fit, risk-return profile, and financing efficiency: debt, equity, and partnerships.

“While groups of that scale are generally perceived to have strong financial resources and market access, whether a full purchase is feasible or even desirable would ultimately depend on strategic priorities, valuation, structure, and publicly disclosed decisions—not just financial capacity alone,” my source added.

Yes, Virginia, I agree that Mr. Co owns a bank. Remember, however, that there is DOSRI (directors, officers, stockholders, and related interests) which limits the financial exposure of a financial institution to its sister companies.

“Big brother” banks like BDO Unibank and Philippine National Bank stand ready to provide the facility. Aside from teeming liquidity, Mr. Co has several bank lines, including an outstanding facility with BDO.

I believe Mr. Co is ahead of the transaction as it is in sync with his diversification path.

And as the wheels of business continue to churn, I see a potential merger on the horizon. There may be a marriage between PrimeWater and Panama Water Corp., a utility firm that operates in select areas of Pangasinan, Tarlac, Pampanga, Nueva Ecija, Bulacan, Laguna, and as far as Pagadian City in Mindanao.

Let’s watch how this plays out.