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Friday, March 29, 2024

Ayala grants Razon majority 51% voting interest in Manila Water

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Port and casino tycoon Enrique Razon Jr. is getting a majority 51-percent voting interest in Manila Water Co. Inc., the water concessionaire led by the Ayala Group.

Ayala Corp. said in a disclosure to the stock exchange subsidiary Philwater Holdings Company Inc. granted proxy rights to Razon’s Trident Water to enable the latter to achieve 51-percent voting interest in Manila Water.

Enrique Razon Jr.

Philwater owns 4 billion of preferred shares in Manila Water, representing 65.95-percent of voting shares in the water utility firm.  Upon the grant of proxy rights to Trident Water, Ayala Corp.’s effective voting interest in Manila Water will stand at 31.6 percent.

“The shareholders’ agreement will become effective after the closing of the subscription agreement, which will occur after certain conditions are met, including required lenders’ consent and regulatory approvals,” Ayala Corp. said.

“This arrangement aims to strategically rationalize the economic and voting stakes between Ayala and Trident Water as strategic partners in Manila Water,” it said.

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Ayala Corp. will still have the largest economic interest of 38.6 percent in Manila Water, compared to Razon’s 25 percent.

Ayala Corp. said Monday Razon’s group agreed to acquire a 25-percent stake in Manila Water for P10.7 billion. Under the agreement, Razon will buy 820 million common shares of the utility firm at P13 per share.

The entry of Razon as a strategic investor is expected to bolster the company’s ability to provide reliable, efficient and sustainable water and wastewater services in the East zone and pursue growth initiatives both domestically and globally. Jenniffer B. Austria

It is also expected to strengthen the company’s balance sheet and allow it to be more agile in pursuing long-term strategic initiatives.

Manila Water emerged as a major water infrastructure player in Southeast Asia with investments in several platforms across Vietnam, Thailand and Indonesia. It is constantly on the lookout for opportunities in the region.

This is the second partnership between Razon and Manila Water. WawaJVCo, a joint venture of  Razon’s Prime Infra and businessman Oscar Violago’s San Lorenzo Ruiz Builders Group, earlier signed an agreement with Manila Water to develop the Wawa bulk water supply project.

The stock of Manila Water climbed 9.8 percent Thursday to close at P14.96.

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