SMC OK to add MPTC Indonesia in joint venture

MANILA, Philippines — Diversified conglomerate San Miguel Corp. (SMC) is open to including the Indonesian segment of Metro Pacific Tollways Corp. (MPTC) in the planned merger of the toll road operators.

SMC president and CEO Ramon Ang told reporters  the proposed merger between the tollway giants could take shape over the next few months.

Ang said the current focus of negotiations is whether the Indonesian business of MPTC will be covered by the joint venture given its length and value.

Either way, Ang is open to involving Indonesia in the proposed consolidation, captivated by the business potential that it will bring. Further, he sees opportunity in the fact that Indonesia is three times larger than the Philippines in terms of economy.

“Indonesia is a promising economy with $1.7 trillion in GDP, three or four times bigger than us. I think it should be good, the Indonesian tollway,” Ang said.

MPTC is projected to win the bidding for a 35 percent share in PT Jasamarga Transjawa Tol, the concessionaire managing a 676-kilometer portion of the Trans-Java Toll.

Once the contract is awarded, MPTC’s foreign business will outvalue its domestic network, and this will play a critical part in the proposed merger with SMC.

To be exact, the entry of the Trans-Java Toll in the equation will add more than 850,000 vehicles to the daily volume in MPTC’s network.

In an earlier interview with The STAR, MPTC chairman Manuel V. Pangilinan said the agreement is to own the joint venture equally in half. With this, Pangilinan noted that the smaller company would pay the bigger player in cash or assets, or both, to even the shareholdings.

MPTC plans to sell its 44.9 percent stake in CII Bridges and Roads Investments Joint Stock (CII B&R) to simplify its business structure in preparation for the possible merger. CII B&R manages the Vietnamese tollways Hanoi Highway Expansion Phase 2 and the Rach Mieu Bridge.

Once the companies are merged, the tycoons want to list an infrastructure giant in the Philippine Stock Exchange, and together they plan to put up elevated toll roads on congested thoroughfares like C5 Road and EDSA.

MPTC maintains the North Luzon Expressway, Subic-Clark-Tarlac Expressway, Manila-Cavite Expressway, Cavite-Laguna Expressway and Cebu-Cordova Link Expressway, while SMC runs the Tarlac-Pangasinan-La Union Expressway, Skyway System, Southern Tagalog Arterial, South Luzon Expressway and NAIA Expressway.