Tuesday, 7 April 2009

Metro Pacific wants to buy Manila-Cavite Coastal Road project


LISTED HOLDING firm Metro Pacific Investments Corp. wants to buy into the consortium that controls the Coastal Road project, as part of a plan to improve its water utility’s service in Cavite.

During Thursday’s inauguration of Metro Pacific’s P38-billion project to construct roads linking to the North Luzon Expressway, Chairman Manuel V. Pangilinan told reporters he was negotiating with the Public Estates Authority Tollway Corp., the state firm that operates the Manila-Cavite Toll Expressway.

"We are eyeing the existing company. [But] the talks have been on and off. I can’t understand why they are not talking to us when frankly, they are not doing anything and going anywhere," he said.

The Coastal Road is being extended by a joint venture between the state-owned Philippine Reclamation Authority, the former Public Estates Authority, and UEM-Mara Philippines Corp. of businessman Luis J.L. Virata.

The Manila-Cavite Toll Expressway project consists of the rehabilitation of the existing 6.6-kilometer (km) R-1 Expressway from Seaside Drive in Parañaque to Zapote in Las Piñas, a 7.5-km. link from the South Luzon Expressway to R-1, and the 11.4-km. R-1 Extension from Zapote to Noveleta in Cavite.

The Public Estates Authority Tollway Corp. has been collecting toll fees and remitting 90% of the revenues to UEM-Mara. UEM-Mara got a P3.5-billion loan from a group of banks for the Coastal Road project back in 2006.

The R-1 upgrade was finished years ago and UEM-Mara is working on the initial 7-km. segment of the extension, from Zapote to Kawit in Cavite. The final segment is the 4.3-km. extension from Kawit to Noveleta.

The link between the South Luzon Expressway and R-1, meanwhile, has been hounded by right-of-way problems.

Mr. Pangilinan said acquiring the Coastal Road project would allow Metro Pacific’s water utility, Maynilad Water Services, Inc., to improve its service in Cavite.

Metro Pacific already owns the operations of the North Luzon Expressway, making it a major infrastructure player. A 67% stake in the concession was bought from the Lopez family last year for P12.2 billion.

In a telephone interview yesterday, Ramoncito S. Fernandez, president and chief executive officer of Metro Pacific tollway unit Manila North Tollways Corp., said investing in the Coastal Road project makes sense for the Pangilinan-led firm as this would lead to "synergies."

"If you get that road network you also get the right of way and [lay water pipes there]," he said.

Maynilad is owned by a joint venture between Metro Pacific and the DMCI Holdings, Inc. of the Consunjis, which took over from the Lopezes who gave up on the utility in 2005.

"We welcome reviving the discussions (over the Coastal Road) ... We are also open to continuing any expansion program that has been earmarked for that road," he said.

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