MPIC’s Vietnam venture hits snag

MANILA, Philippines - The planned investments of infrastructure giant Metro Pacific Investments Corp. (MPIC) in a toll road operator in Vietnam hit a road block due to ownership dispute.

MPIC president Jose Ma. K. Lim said the proposed investment in the $750 million Dau Giay-Phan Thiet motorway would have to wait until the resolution of the ownership issue.

MPIC and parent firm First Pacific Co. Ltd. of Hong Kong prequalified for the bidding of the public private partnership (PPP) project being undertaken by the Vietnamese government and the World Bank as well as private partner Bitexco Group.

 “We prequalified but as I understand the project is delayed because of multiple claims to the ownership. So let them sort it out first,” he said.

The 100-kilometer four-lane Dau Giay-Phan Thiet motorway connecting the key southern cities of Ho Chi Minh City and Phan Thiet is a critical link in the national north-south transport route.

The Bitexco Group would hold 60 percent interest in the project while the government and other private investors would own 40 percent. The shareholders would be given a 30-year concession.

Last February, MPIC said it could invest up to $1 billion in two major toll road projects in Vietnam.

The company is in talks with Cuu Long Infrastructure Development and Management Corp. (Cuu Long CIMP) to submit a proposal to the Ministry of Transport of Vietnam for the expansion of a second toll road project in the northern portion of Ho Chi Minh.

Cuu Long CIMP is the counterpart of the state-run Philippine National Construction Corp. (PNCC) in Vietnam.

MPIC is keen on further raising its 29.45 percent interest in Don Muang Tollway Public Company Ltd (DMT) via FPM Infrastructure Holdings Ltd. by buying the 20 percent stake of the government of Thailand.

Last May 30, MPIC announced the acquisition of the 75 percent stake of parent firm First Pacific Co. Ltd in FPM Infrastructure for a $101.25 million.

The transaction raised MPIC’s stake in FPM Infrastructure to 100 percent from 25 percent and its economic interest in DMT to 29.45 percent from 7.36 percent.

In November, First Pacific and MPIC invested P5.8 billion to acquire a 29.45 percent stake in DMT.  First Pacific spent P4.4 billion for a 26.2 percent stake in the tollroad operator while MPIC invested P1.4 billion for a 3.25 percent interest in DMT.

The vendor of the toll road stake is a 50-50 joint venture between Bank of Tokyo-Mitsubishi UFJ and South East Asian Strategic Assets Fund. Other major shareholders of DMT include the Phanichewa Group with 37.1 percent and Thailand’s Ministry of Finance with 25.1 percent.

DMT operates a 21.9-kilometer six-lane elevated toll road stretching from Din Daeng in central Bangkok past Don Muang Airport and on to the National Monument in the north of the capital under a 27-year concession ending in 2034.