MPIC eyes major acquisitions this year

MANILA, Philippines — Infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) is on expansion mode following a strong financial performance at the start of the year, with the group looking to make some significant acquisitions in the areas of logistics, agriculture, real estate and tourism this year.

MPIC chairman Manuel V. Pangilinan said the company is actively evaluating opportunities in multiple sectors that would potentially enable further economic development, such as logistics, agriculture, real estate and tourism.

“There are quite a number of these transactions on the board. It’s difficult to predict the timing, so I guess it depends also on your counterparties as to when they can agree and so forth and so on,” Pangilinan said in a briefing yesterday.

“We’d like to see some of these transactions–one, two or three–close in the course of the year because it’s important that we’re able to see these opportunities as being income accretive, value accretive to MPIC in the future,” he said.

Financially, Pangilinan said MPIC is in the position to make some significant acquisitions in the course of the year.

In agriculture, the tycoon said MPIC is looking at several opportunities, with “a number of these are private companies that operate in that sphere and some are listed.”

“In due course we will announce once there’s a transaction. What’s available that we’re seeing are the bread and butter kind of investments. They’re the tangible kind of agricultural investments,” Pangilinan said.

“We would hope that over time, that we’re able to apply a certain IT kind of solutions to agriculture eventually,” he said.

Meanwhile, with regards to the intent of the Ayala group to divest its interest in the LRT-1, Pangilinan said MPIC has been made aware of such plans.

He said MPIC’s decision of possibly acquiring its partner’s interest or potentially increasing its stake would greatly depend on the outcome of the upcoming elections.

“Because we need to understand what the new president might do in respect of LRT-1 because we have pending applications for tariff adjustments, tariff increases for LRT-1 which have not been given since the concession was given some time in 2015. So it’s been seven years where we’ve spent quite a bit of money to rehabilitate the existing system of LRT-1,” Pangilinan said.

“We told the board that we should sort of consider it and hold our thinking in abeyance for the next few months or weeks, again depending on how we assess the political landscape moving forward,” he said.

Pangilinan, however, said the continuing strong demand for MPIC’s services despite geopolitical uncertainties supports the group’s optimism for 2022.

He said MPIC’s focus over the near to medium term is to continue to deliver on its commitments to support infrastructure development in the country.

In the first quarter, MPIC reported a consolidated core net income of P3.1 billion, up 23 percent from P2.5 billion in the same period last year.

MPIC said it benefitted from continued economic recovery and intensified election-related activities in the country during the period.

Toll road traffic is now close to pre-pandemic levels, and power consumption has considerably increased as more industries ramp up operating capacity, it said.

Contribution from operations in the first quarter increased by 14 percent to P4.3 billion, with power accounting for P2.5 billion or 58 percent of the total, followed by toll roads at P1.2 billion or 29 percent.

“Economic recovery continues to be this year’s story. It is MPIC’s story as well, but one that is inextricably linked to everyone else’s. Understanding this interconnectedness is a crucial lesson we have learned from the pandemic: that we need to come together to work out how we can progress from a crisis; that our development as a business is tied to the advancement of others.

Such progress is as significant as profit and is therefore linked to creating value for all. In other words, our progress is yours as well,”Pangilinan said.