Manila Water inks P8.7 billion loan for Thailand venture

MANILA, Philippines — Ayala-led Manila Water Co. Inc. has secured an P8.7 billion loan to finance its acquisition of 18.7 percent stake in Eastern Water Resources Development and Management Public Co. Ltd.

In a regulatory filing, the utility firm said its subsidiary Manila Water Thailand Co. Ltd. signed a 5.3 billion Thai baht (P8.7 billion) five-year term loan facility with the Bangkok branch of Japanese-owned Mizuho Bank Ltd. and Bank of Ayudhya Public Co. Ltd.

Eastern Water is a publicly-listed water supply and distribution company in Thailand.

The acquisition, which is Manila Water’s first investment in Thailand, is expected to further bolster the company’s expansion in the ASEAN region.

It was in March 2018 when Manila Water successfully acquired 311.44 million ordinary shares in East Water.

East Water is a publicly listed company in Thailand and is engaged in the provision of raw water and tap water since 1992 in the provinces of Rayong, Chachoengsao and Chonburi – the country’s main industrial regions.

It also holds concession contracts to operate in 11 different locations and provides water service to several industrial estates – all situated within a total area of 13,285 square kilometers or nearly as large as the whole Calabarzon.

East Water presents significant growth potential by way of the Eastern Economic Corridor (EEC), the Thai government’s initiative to further develop the country’s eastern seaboard into a leading economic zone in ASEAN.

Manila Water’s entry in Thailand comes after its foray into bulk water and concession projects in Vietnam, where it is now the largest direct foreign investor in Vietnam’s water sector supplying half of the bulk water requirements of Ho Chi Minh City.

Manila Water saw a six percent increase in net income to P6.5 billion last year, driven by the continued growth of its east zone concession coupled with the approval of its positive tariff adjustment.

The company covers the east zone which encompasses parts of Makati, Mandaluyong, Pasig, Pateros, San Juan, Taguig, Marikina, most parts of Quezon City, portions of Manila, as well as several towns in Rizal.