Japanese partner eyes higher stake in MPTC

MANILA, Philippines — A Japanese joint venture is planning to raise its stake in Metro Pacific Tollways Corp. (MPTC) in a transaction that could lay the groundwork for one of the biggest mergers in the Philippines.

MPTC is looking to secure fresh funds through an equity sale to Mit-Pacific, the joint venture between Mitsui & Co. Ltd. and the Japan Overseas Infrastructure Investment Corp. for Transport and Urban Development.

Mit-Pacific owns a 6.6-percent stake in MPTC as part of the P12-billion agreement it signed with Metro Pacific Investments Corp. (MPIC).

MPIC chairman Manuel V. Pangilinan confirmed to reporters that Mit-Pacific is bent on scaling up its ownership in MPTC. For MPTC, the deal could mean raising at least P30 billion that it can use for debt payment.

Pangilinan said MPTC has to cut its debt first before it can merge with San Miguel Corp.’s (SMC) toll business as planned. As of 2023, MPTC owes P153.21 billion to lenders, the highest among MPIC groups, including its parent’s debt of P77.18 billion.

“We have to raise money first for our tollways, and when we are done with that, then we can do the merger talks (with SMC),” Pangilinan said.

In March, Pangilinan announced that MPIC is selling as much as 20 percent of MPTC to pick up fresh funds for debt settlement.

At the time, Pangilinan declined to identify the prospective investor of MPTC, but he confirmed that a transaction should be closed in two months.

In 2024, MPIC bought back the shares of Mit-Pacific, reducing Mit-Pacific’s interest in MPIC to 7.8 percent, from 14.5 percent. MPIC issued to Mit-Pacific an P11.9-billion exchangeable bond, which equates to a 6.6-percent ownership in MPTC.

MPTC is also looking at going public next year to raise more funds, but the long-term plan of the company is to merge with SMC’s toll venture. Once the merger materializes, it would establish a tollway superpower that controls the biggest expressways in the country.

The resulting company from the merger would also operate several projects abroad, as MPTC is a significant owner of select tollways in Indonesia and Vietnam. MPTC is also working with SMC in pursuing the P72-billion effort to build the Cavite-Batangas Expressway and Nasugbu-Bauan Expressway to improve access to Southern Tagalog.