MPIC sees valuation of $3 billion for hospital unit

MANILA, Philippines — Metro Pacific Investments Corp. (MPIC), the infrastructure and tollways conglomerate chaired by tycoon Manuel V. Pangilinan, is looking at a valuation of up to $3 billion for its hospital unit.

“It would be well north of $2.5 billion, closer to $3 billion,” MPIC chief financial officer David Nicol told The STAR on Friday.

Nicol said the company is also pouring in additional investments for the hospital unit for expansion and to support growth of its current portfolio.

MPIC is selling a portion of its stake in the hospital business, Metro Pacific Hospital Holdings Inc. (MPHHI).

The move is to help beef up liquidity and consequently pare down debt at the parent company.

Nicol said the timetable of the sale would depend on the final valuation of the unit.

Pangilinan said the only way to address the high debt level is to sell down assets to create liquidity.

Pangilinan said it has to be of some significance to produce an effect that is substantial to the bottomline.

MPIC has been trading at an average of P4.30 per share. Its highest price the past 52 weeks has reached only P5.56 per share, while its lowest was P4.11 per share.

Pangilinan said the regulatory problems faced by Metro Pacific Tollways Group and Maynilad Water Services Inc. have also affected the share price of MPIC.

MPIC is already in talks with investment banks for the hospital divestment, which is targeted to be concluded this year.

Those that have expressed interest are mostly private equity funds.

MPIC decided to do a private transaction for the hospital business instead of a previous plan to do an initial public offering (IPO). The market has not been conducive for an IPO even as many investors have been looking forward to an IPO of MPHHI.

Aside from the hospital unit, MPIC is also looking to tap a strategic partner for its tollways business.

Pangilinan said there have been preliminary talks with potential foreign partners, but nothing definite has yet been firmed up.

MPIC, one of the country’s biggest conglomerates, has investments in tollways and infrastructure, water utility, power, logistics, and hospitals.