DMCI Holdings subsidiary reduces stake in Subic Water
DMCI Project Developers (DMCI PDI) has reduced its stake in Subic Water and Sewerage Company in the Philippines.
As disclosed to the Philippine Stock Exchange, DMCI Project Developers has sold its 10% stake in Subic Water to the City of Olongapo.
DMCI Project Developers has sold its stake in order to allow the local government to hold interest in the sewerage company.
Worth nearly PHP210.6m ($4.5m), he deal enabled the city to get back its ownership in Subic Water, after it sold its 10% stake to Maynilad Water Services in 2013.
Maynilad is owned by a consortium comprising DMCI Holdings, Japan-based Marubeni Corporation, and Metro Pacific Investments.
DMCI chief financial officer Herbert M Consunji was quoted by Business World online as saying: "The buyback has been [requested] by the city which we accommodated."
After completion of the sale of 10% of its stake, DMCI Project Developers will hold 30% interest in Subic Water.
DMCI was quoted by Manila Bulletin as saying: "The Olongapo City local government unit (LGU) wanted representation in Subic Water because their constituents accounted for a majority of the company's customers.
"As the single biggest shareholder of Subic Water, DMCI PDI was in the best position to make this happen.
"We believe the new ownership structure will result in better collaboration among the stakeholders, ultimately benefitting the water consumers in Olongapo City and Subic Bay Freeport."
Formed in 1997, Subic Water owns the exclusive right to operate, maintain and improve water and sewerage systems of Olongapo city and Subic Bay Freeport under a 30-year franchise term, reported Inquirer.net.
Other stakeholders in Subic Water are Sembcorp Industries, Maynilad Water Services and Subic Bay Metropolitan Authority.