MNTC to borrow P10 B in Q4

MANILA, Philippines - Manila North Tollways Corp. (MNTC), a unit of infrastructure giant Metro Pacific Investments Corp. (MNTC), is raising P10 billion in the last quarter of the year to finance its P18-billion toll road that would connect the North Luzon expressway (NLEX) and the South Luzon expressway (SLEX).

This after the company successfully listed P7 billion worth of retail bonds at the Philippine Dealing and Exchange Corp. (PDEX) yesterday morning.

MNTC president Rodrigo Franco said in an interview with reporters that the fund raising activity would be conducted in the last quarter of the year after getting approval from the Toll Regulatory Board (TRB) for the proposed NLEX-SLEX connector road.

“That is around P10 billion and will immediately be after the TRB approval. So we are hoping by the third or the fourth quarter we will be raising financing again,” he stressed.

MNTC is looking at a combination of ways to raise the funds either from existing shareholders or through the issuance of bonds.

According to Franco, about 70 percent would be in the form of debt while the remaining 30 percent would be from internally generated funds or cash from existing shareholders.

Franco added that MNTC is closely watching developments in the financial markets after the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) raised the reserve requirements by a percentage point last March 27.

Effective April 4, the reserve requirement for commercial banks would increase to 19 percent from 18 percent, seven percent from six percent for thrift banks, and five percent from four percent for rural banks

The move would guard against potential risks coming from continued strong liquidity growth and rapid credit expansion as this would mop up P60 billion worth of liquidity in the financial system.

“Well we have to evaluate because of the developments in the financial markets. We have to study the impact of the decision of the BSP to raise (reserve) requirements,” he explained.

Franco said proceeds of yesterday’s listing at the PDEX would be used to finance the P10-billion Harbor Link project.

“We are deeply honored to join today the elite list of issuers of PDEX-listed fixed income securities. We intend to return to the market in the near future to seek more funds for our road building activities,” he said in his speech.

For his part, Metro Pacific Tollways Corp. president Ramoncito Fernandez said the MPIC Group has earmarked P40 billion worth of investments for various road projects here and abroad over the next five years.

Aside from local projects, MPIC earlier said it is looking at two major toll road projects in  Vietnam  that could entail investments of up to $1 billion as part of efforts to diversify its presence in the region.

The company is in talks with Cuu Long Infrastructure Development and Management Corp. (Cuu Long CIMP) to submit a proposal to the Ministry of Transport of Vietnam  for the expansion of a second toll road project in the northern portion of Ho Chi Minh.

Cuu Long CIMP is the counterpart of the state-run Philippine National Construction Corp. (PNCC) in  Vietnam.

“It’s moving well. We had the  Vietnam  potential partners visit  Manila  last month. They were very happy with their visit so we are on schedule to submit a joint proposal to the Vietnamese government.

MPIC and parent firm First Pacific Group of Hong Kong are also awaiting the result of the bidding for the first public private partnership (PPP) project in Vietnam involving a $750-million Dau Giay-Phan Thiet motorway being undertaken by the Vietnamese government and the World Bank as well as private partner Bitexco Group.

Last November, First Pacific and MPIC through FPM Infrastructure Holdings Ltd. Invested P5.8 billion to acquire a 29.45-percent stake in Don Muang Tollway Public Co. Ltd. (DMT) of Thailand.