Metro Pacific Investments Corp. said Wednesday it teamed up with Keppel Infrastructure Trust of Singapore to acquire 100 percent of Philippine Tank Storage International Holdings Inc., which owns the country’s largest petroleum import storage facility in Subic Bay, for $334 million.
Metro Pacific said in a disclosure to the stock exchange that it and KIT signed an agreement with Macquarie Infrastructure Holdings (Philippines) Pte. Limited, Government Service Insurance System and Langoer Investments Holding B.V. 2O purchase 100 percent of the total issued capital stock of PTSI that owns Philippine Coastal Storage & Pipeline Corp.
Metro Pacific said it will initially acquire a 20-percent stake in the company that will have full ownership in PCSPC for $67 million, with an option to increase it to 50 percent. The acquisition will enable it to diversify its portfolio and revenue streams in a new industry vertical with strong growth potential, it said.
PCSPC is the largest independent storage facility in the Philippines with a capacity of 6 million barrels once the current expansion plan is completed by early 2021. It generates stable cash flows via take-or-pay contracts with high-quality off-takers.
“With PCSPC accounting for 36 percent of the total import terminal storage requirements of the Philippines, MPIC sees this facility as vital energy infrastructure for the country. MPIC and its strategic partner KIT look forward to further expanding the capacity of PCSPC to provide millions of Filipinos with added energy security,” Metro Pacific chairman Manuel Pangilinan said.
Matthew Pollard, chief executive of Keppel Infrastructure Fund Management Pte. Ltd., the trustee-manager of KIT, said the acquisition would enable KIT to diversify, grow and strengthen its distributable cash flow.
“As the largest petroleum products import storage facility in the Philippines, where demand for petroleum products is expected to grow, PCSPC presents an attractive opportunity for KIT to capture opportunities arising from the strong macroeconomic outlook as well as robust growth fundamentals for imported petroleum products in the Philippines,” Pollard said.
The 150- hectare facility consists of 86 storage tanks, two piers and a pipeline infrastructure connecting the entire facility.
Strategically located in the Subic Bay Freeport Zone, PCSPC provides clients with a well-connected distribution hub to the largest economic catchment.
KIT is the largest diversified infrastructure business trust listed on the main board of the Singapore Stock Exchange. Its portfolio of infrastructure assets includes waste treatment, water desalination, power generation and transmission, piped gas production and retailing and chemical manufacture and distribution primarily in Singapore and Australia.