Prime Metroline has signed a subscription agreement with Manila Water to acquire 820 million common shares for the company, or a 25% stake, for $210m.
Prime Metroline has agreed to acquire a 25% stake in Philippines-based water and used water services provider, Manila Water.
For the deal, Prime Metroline has signed a subscription agreement with Manila Water to acquire 820 million common shares for the company, or a 25% stake, for $210m.
Manila Water said that the investment is expected to boost its ability of providing reliable, efficient and sustainable water and wastewater services in the East Zone and also allow it to pursue growth initiatives both domestically and globally.
The Philippine water company is also expected to benefit from The Razon group’s global reach and business expertise, with operations in the Asia Pacific, Latin America, Middle East and Africa.
Manila Water chairman Fernando Zobel de Ayala said: “Our partnership with the Razon group will result in clear synergies to achieve Manila Water’s long-term goal of providing sustainable water and wastewater services to our customers in the East Zone of Metro Manila and in the other markets we serve.
“Our partnership combines our respective technical and management expertise. Looking beyond our domestic businesses, the extensive global experience of Mr. Razon through his port operations opens more opportunities for Manila Water to serve new markets.”
Acquisition to allow Manila Water to pursue its long-term strategic initiatives
The deal brings additional equity capital to the water services company to strengthen its balance sheet and allow the company to pursue its long-term strategic initiatives.
In February last year, Manila Water along with its subsidiary Manila Water Philippine Ventures signed an $29.3bn agreement with Tanauan Water District to implement a project to improve the provision of water supply and sanitation services in Tanauan, Philippines.
Under the 25-year agreement, Manila Water was responsible for the design, construction, rehabilitation, maintenance, operation, financing, expansion, and management of the water supply and sanitation facilities and services of the water district.
In 2014, Maynilad Water Services signed a contract with Manila Water for implementing the Sumag River Diversion project, which was expected to provide additional supply in Metro Manila and nearby provinces.