Maynilad Water Services Inc., the water concessionaire for the west zone of Metro Mania, is set to get a new minority investor, an executive said Wednesday.
Maynilad’s parent company Metro Pacific Investments Corp. is in talks with an Asian company for the sale of roughly 10-percent in the water company for P12 billion.
“We are in discussion with a party at the moment. If we are in agreement, we hope we could sign a provisional term sheet over the next two to three weeks,” Metro Pacific chief finance officer David Nicol said.
“Then it will be subject to confirmation and due diligence which gives them 90 days,” he said.
The sale will reduce Metro Pacific’s stake in Maynilad to 42.8 percent from the current 52.8 percent, making it still the single biggest shareholder.
Other major investors in Maynilad are Japanese trading firm Marubeni Corp. and DMCI Holdings, which own 20 percent and 16 percent, respectively.
Nicol said the terms of the sale was on the premise that the current arbitration case involving the water company would be resolved soon in favor of Maynilad.
Maynilad in 2014 received a favorable award in the arbitration of its 2013 to 2017 water tariff which centered on corporate income taxes being a recoverable expense.
State-run Metropolitan Waterworks and Services System had not yet implemented the awarded tariff increase, saying it would await clarification from the Supreme Court before proceeding.
Acting in formal accordance with the provisions of its concession, Maynilad notified the government that it was calling on the government’s written undertaking to compensate Maynilad for losses arising from delayed implementation of the new tariff.
Maynilad served a notice of arbitration against the Republic in March 2015.
“Hearings on the arbitration [were] completed in December 2016 and we expect resolution in our favor in the next few weeks,” Maynilad said.
Maynilad allocated P13.2 billion for its water and wastewater infrastructure projects this year, including P5 billion for sewerage and sanitation programs and P8.2 billion for water sources and water loss recovery.