METRO Pacific Investments Corp. (MPIC) may reconsider acquiring Ayala Corp.’s stake in Light Rail Transit Line 1 (LRT-1) due to unresolved valuation issues, according to its chairman.
“We talked to them before, but there’s a bit of a gap in valuation, and I do not know how we can bridge it,” MPIC Chairman, President, and Chief Executive Officer Manuel V. Pangilinan told BusinessWorld recently.
In February, MPIC said it was exploring the possibility of acquiring Ayala’s stake in LRT-1, following Ayala’s divestment plan announcement.
According to Mr. Pangilinan, MPIC’s interest in acquiring Ayala’s stake was driven by the potential opportunity to participate in the planned auction for the Metro Rail Transit Line 3 (MRT-3).
The Transportation department is also evaluating MPIC’s unsolicited proposal to integrate the operations of MRT-3 and LRT-1.
Earlier this year, Ayala expressed optimism about completing its $1-billion divestment plans within 2024.
Ayala intends to raise $1 billion by divesting its shares in water and infrastructure assets.
The company hopes to close the sale of its 35% stake in LRT-1 within the year to realign its portfolio in property, telecommunications, and energy.
MPIC, through its unit Metro Pacific Light Rail Corp., holds 35.8% stake in Light Rail Manila Corp. (LRMC), the operator of LRT-1.
The remaining shares in LRMC are owned by Sumitomo Corp. at 19.2% and Philippine Investment Alliance for Infrastructure’s Macquarie Investments Holdings (Philippines) Pte. Ltd. at 10%.
MPIC is one of the three key Philippine units of Hong-Kong based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority share in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose