Manila Water inks $150-million term loan with 4 international banks

MANILA, Philippines - Manila Water announced yesterday that it has concluded a $150-million term loan facility with four international banks.

The term loan facility will enable the Ayala-led, East Zone water concessionaire Manila Water to finance its capital expenditure plans for the expansion and the maintenance of water supply facilities and distribution network.

The term loan was lead-arranged by ING Bank N.V. Tokyo Branch, and involves three other banks – Bank of Tokyo Mitsubishi UFJ, Mizuho Corporate Bank, and Sumitomo Mitsui Banking Corp.

According to Manila Water, the loan benefits from the Overseas United Loan Insurance (OULI) program of the Nippon Export and Investment Insurance (NEXI) which partially covers political and payment risk of Manila Water.

NEXI is a Japanese export credit agency under the supervision of the Ministry of Economy, Trade and Investment of Japan.

According to Manila Water, the term loan deal is the first time for NEXI to provide its OULI for a water project anywhere in the world.

In a statement, Manila Water president Gerardo C Ablaza Jr. said “this loan transaction is a landmark deal for our company. The insurance cover provided by NEXI allowed us to stretch the tenor of the loan facility up to 10 years, which is not usual for commercial loan transactions.”

Ablaza said “the favorable terms that we obtained from out lenders are an indication of the banks’ confidence in the financial capability of our company.”