MetroPac Water Investments, a subsidiary of Metro Pacific Investments, has signed an agreement to buy 128.7 million common shares in the Manila Water Consortium.
The consortium is developing a bulk water supply system in the province of Cebu, Philippines.
The Cebu bulk water supply system will use water from the Luyang River in the town of Carmen to provide water to the residents in the region.
As a part of the agreement, the company has invested an initial amount of PHP128.7m ($3.1m) to buy a 39% interest in the consortium.
In a joint statement, Metro Pacific Investments and Manila Water mentioned that the acquisition of interest in the consortium will improve financial and technical support for the water supply system.
The entry of MetroPac will be finalised once the Securities and Exchange Commission (SEC) approves the rise in the authorised capital stock of the consortium from PHP250m ($6.1m) to PHP750m ($18.3m), reported Manila Bulletin.
Once SEC gives its approval, MetroPac will own a 39% interest in the consortium, whereas Manila Water Company and Vicsal Development will own 51% and 10% interest, respectively.
A joint investment company formed between the government of Cebu and the Manila Water Consortium, Cebu Manila Water Development (CMWD), has already started implementing the bulk water supply system.
For the Cebu project, the CMWD and the government of Carmen signed two memoranda of agreement (MOA) to develop, operate, and maintain the water supply system.
The first MOA also includes recovery of the advance payment made by Manila Water Consortium and outlines the responsibilities of the municipality for the implementation of the bulk water supply project.
Under the second MOA, the catchment area around the Luyang River will be managed and protected.
Image: MetroPac is buying a stake in the Manila Water Consortium, which is developing a bulk water supply system to address water problems in the region. Photo: de:Benutzer:Alex Anlicker