Manila Water sells stake in Bulacan units to SMC

MANILA, Philippines — Razon-led Manila Water Co. Inc. is divesting its stake in two Bulacan joint venture corporations for P1 billion to a subsidiary of San Miguel Corp. (SMC) as it focuses on other activities outside the East Zone concession.

Manila Water said its subsidiary Filipinas Water Holdings Corp. (FWHC) signed a share purchase agreement with SMC Bulacan Water Services Corp. to sell FWHC’s interests in Bulakan Water Co. Inc. (BWCI) and Obando Water Co. Inc. (OWC).

The agreement covers the 90 percent stake of FWHC in both BWCI (135 million shares) and OWCI (88.2 million shares) for a total price of P1.024 billion.

FWHC is selling its shares in BWCI at P4.486 apiece while its stake in OWCI is priced at 4.748 each.

Proceeds of the transaction would be used to finance “other strategic initiatives” of Manila Water, the company said.

“The transaction will monetize FWHC’s assets, and the proceeds will be used to fund other strategic initiatives of MWC and Manila Water Philippine Ventures, Inc., a wholly owned subsidiary of MWC which houses its Philippine business units outside the East Zone concession,” Manila Water said in a disclosure to the Philippine Stock Exchange yesterday.

Payment for the transaction would be settled in full on the closing date of the agreement.

BWCI and OWCI are joint venture companies of FHWC with two separate local water districts to operate the concession for the supply of water and sanitation services in Bulakan and Obando, Bulacan, respectively.