AN ALL-FILIPINO consortium backed by San Miguel Corp. (SMC) and DMCI Holdings Inc. expects to seal an P11.5-billion loan agreement with a group of local banks, allowing it to secure the bulk of the financing needs for the P19-billion, 84.5-kilometer Tarlac-Pangasinan-La Union Expressway.
Private Infra Dev Corp. (PIDC) chief finance officer Myra Reinoso told the BusinessMirror that the loan agreement with Banco de Oro Unibank Inc., Development Bank of the Philippines and Land Bank of the Philippines is expected to be signed this week.
Reinoso said the loan will have a minimum maturity of 10 years although details covering its terms were not immediately available.
Despite having to start the project at a later than expected date, the expressway that aims to cut travel time from Manila to Baguio City by half is still slated for completion in 2014, Reinoso said.
“This is a viable project [especially] with the high cost of fuel. It is imperative for roads to become more efficient,” she said in a phone interview.
Upon completion, the expressway is expected to spur economic growth and increased job opportunities in the North and Central Luzon areas.
Construction is currently being funded by private shareholders whose direct contribution amount to P4.5 billion while P2.7 billion will come from government subsidies, Reinoso said. The remainder will be covered by the loan agreement.
DMCI owns about 32 percent of PIDC while SMC, through unit Rapid Thoroughfares Inc., controls 35 percent plus an option to increase its stake to a controlling 51 percent.
Reinoso said PIDC would likely issue new shares to allow SMC to increase its stake, although this would happen should there be an increase in funding requirements.
Other PIDC stakeholders also include First Balfour Inc., DM Wenceslao and Associates Inc., CM Pancho Construction Inc., RD Policarpio and Co. Inc., JV Angeles Construction Corp., JE Manalo and Co. Inc., New Kanlaon Construction Inc., EEI Corp. and Rockford Development Corp.
San Miguel, a food and drinks giant which has been diversifying into infrastructure, saw its shares dip 0.45 percent to P109.50 each on Friday.
DMCI, a holding firm with interests in construction, water infrastructure, real estate development, power and mining, closed flat at P42.90 each.
