MPIC to proceed with the acquisition of Ayala’s shares in LRT-1
Metro Pacific Investments Corp. (MPIC) is set on acquiring the 35 percent ownership held by the Ayalas in the operator of Light Rail Transit Line 1 (LRT-1), aiming to bolster its portfolio for potential bids on other railway projects.
According to MPIC chairman Manuel V. Pangilinan, the company aims to secure the Ayala Group’s stake in Light Rail Manila Corp. (LRMC), thereby increasing its ownership to 70.8 percent.
LRMC manages LRT-1, a vital transportation artery in Metro Manila slated for expansion into Cavite.
Pangilinan emphasized that MPIC’s acquisition of the Ayala Group’s interest in LRMC would enhance its railway business and strengthen its bid for the concession to operate and maintain the Metro Rail Transit Line 3 (MRT-3).
He stated, “I think in principle we are keen on buying the Ayala stake in LRMC for a number of reasons. One is the possibility of being able to bid for the MRT-3.”
MPIC had previously submitted an unsolicited proposal to manage MRT-3, which was rejected by the Department of Transportation (DOTr) in favor of seeking fresh offers for the project.
Under the leadership of Transportation Secretary Jaime Bautista, the DOTr has demonstrated a preference for solicited bidding in the privatization of transportation assets.
The DOTr intends to follow the same approach for the operation and maintenance of MRT-3 once the agreement with Sobrepeña-led Metro Rail Transit Corp. expires in 2025.
In January, Pangilinan expressed his intention to collaborate with San Miguel’s Ramon Ang in bidding for the contract to manage the rail line. San Miguel Corp. (SMC) is also eyeing the operation and maintenance of MRT-3, as it complements the Metro Rail Transit Line 7 (MRT-7) it is constructing.
Both LRT-1 and MRT-7 will connect to MRT-3 upon the completion of the Unified Grand Central Station in Quezon City. This underscores the strategic importance of MRT-3 for MPIC and SMC, as it links to their respective railways in the northern and southern parts of Metro Manila.
Recently, Ayala Corp.’s chief finance officer Alberto de Larrazabal revealed that the Ayala Group aims to exit the railway business within the next six months as part of its divestment strategy.
The Ayalas are looking to raise $350 million from the sale of their 35 percent stake in LRMC and are open to the idea of selling it to Pangilinan’s group.
Business News: MPIC to proceed with the acquisition of Ayala’s shares in LRT-1
