Property developer Ayala Land Inc. is forming a joint venture with Royal Asia Land Inc. for a 936-hectare mixed-use estate development in Silang and Carmona, Cavite.
The Philippine Competition Commission recently approved the planned joint venture.
Ayala Land and Royal Asia will set up a joint venture to acquire, own and develop a 936-hectare mixed-use project with commercial and residential components in Cavite.
Both firms intend to subscribe to shares of the joint venture company, with each party owning 50 percent of the outstanding stock.
Royal Asia, which is owned by PCO South Frontier Holdings Inc., will receive a consultation fee of 2 percent of the joint venture company’s gross revenue for its participation in the planning and development of the property.
Ayala Land, the property’s project and development and sales and marketing manager, will receive a development management fee of 12 percent and sales and marketing fee of 5 percent of the joint venture company’s gross revenues.
“The transaction does not result in the substantial lessening of competition because it will not have a structural effect on the market,” the PCC said in approving the Ayala Land-Royal Asia deal.
Ayala Land currently has several estate projects in Cavite and plans to capitalize on the upcoming infrastructure projects including the Southwest Integrated Transport System terminal, Cavite-Laguna Expressway, Cavite C5 Southlink and LRT 1 Cavite extension.
Among Ayala Land’s estate projects in Cavite are the 700-hectare Vermosa and 250-hectare Evo City.
Meanwhile, PCC also approved the joint venture between Markham Resources Corp. and Alternergy Mini Hydro Holdings Corp.
Under the plan, both parties will invest in three companies that will operate, develop and maintain run-of-river mini hydro projects along the stretch of the Asin, Ibulao, Hungduan, Lamut, and Panubtuban rivers in Ifugao province.
PCC said it found that there were enough competitive constraints by other players in the relevant market.
“The transaction also does not appear to create or strengthen the ability or incentive of the merged firm to engage in withholding capacity,” PCC said.