MPIC eyes maiden bond offering next year

SYDNEY, Australia – Infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) plans to debut on the Philippine bond market next year to raise as much as P10 billion to partly fund the group’s massive capital spending.

“We will make our maiden bond issue next year. We are talking with the ratings agencies. We have a triple A rating and then we didn’t issue bonds, but we reached a point where the level of bank debt and the projects we’re taking is outstripping the ability of the banking system to come and cater for us,” MPIC chief financial officer David Nicol said in a briefing here.

Nicol said MPIC would seek regulatory approval for a P30 billion shelf registration program, with the initial tranche of P10 billion eyed for next year.

“I think as a minimum, we will do a shelf registration of about P30 billion to give us flexibility, but I don’t think we’re allowed to draw more than P10 billion of that next year,” he said.

Under shelf registration, issuers have the option to register and sell issues under the same regulatory documents securities, which they do not intend to sell right away.

Securities to be issued in tranches may be registered for an offering to be made on a continuous or delayed basis for a period not exceeding three years.

For 2018, MPIC has earmarked P100 billion for capital expenditures broken down as follows: P38 billion for toll roads, P21 billion for Manila Electric Co., P17 billion for Light Rail Manila Corp., P12 billion for Maynilad and P6 billion each for its logistics and hospital units.

Next year’s spending forms part of the group’s five-year capex of P653 billion for expansion and new investments in line with the opportunities presented by the massive infrastructure program of the Duterte administration.

Aside from the maiden bond issuance scheduled next year, Nicol said the five-year capex would be also be funded through various means such as project finance, equity partners, value crystalization in the portfolio, banking market, and regulatory resolution.

By 2019, Nicol said MPIC remains keen on conducting an initial public offering (IPO) for its hospital business which is in partnership with Singapore wealth fund GIC.

“This is something we are determined to do. I think, as the dominant shareholder in the play, we’re not looking to exit the thing. I see us holding the over 45 percent of it,” Nicol said.