By VG Cabuag
METRO Pacific Investments Corp. (MPIC), which has investments in most of the country’s infrastructure facilities, said it does not yet plan to sell new shares despite receiving the authority to do so.
In a disclosure to the Philippine Stock Exchange (PSE), MPIC said it has received shareholders’ approval to increase its authorized capital stock from P30.05 billion to P40.05 billion.
“[We are doing this] for flexibility in case the board of directors of MPIC determines in the future that there is a need to raise capital, but does not refer to any particular corporate action to raise capital at the moment,” the company said.
During their annual meeting last week, MPIC shareholders authorized the firm’s board of directors to issue shares out of the said increase in the authorized capital stock or unissued capital stock of MPIC to an investor or investors that the board of directors may identify and to list these shares at the PSE.
In case the firm sells new common shares, the shares to be issued must not exceed 10 percent of the authorized capital stock of MPIC.
“This limitation will apply until the next annual meeting of the stockholder or upon the expiration of the period within which such annual meeting is required by law or under the company’s by-laws to be held, whichever is earlier,” MPIC said.
MPIC is looking to fund the construction of the $1.4-billion Cavite Laguna Expressway (Calax) with a mix of internal funds and borrowings although it is also open to taking in a partner. It may raise as much as P30 billion for the venture.
MPIC CFO David Nicol said the company may be borrowing funds from local and foreign banks with a term of about 10 years.
“We prepared the funds for the initial payment, that’s already been inputed for our budget this year. The next big payment is when we start construction of the road but that needs to wait for the right of way so that’s about two years away,” MPIC President Jose Ma. Lim said.
“We have no plans for an equity fundraising” since there are a lot of local and foreign banks that are offering to help fund the project,” Lim said.
He said the funding mix will depend on the offers we get from these banks and “our internal resources because we have other sources of cash, as well.”
“Obviously, we will be adjusting the leverage of this to make sure that the traffic along Calax will provide enough revenues for debt servicing. We have not determined that at this time,” Lim said.