Maynilad begins preparations for an IPO, with a view to listing in 2026

WEST ZONE concessionaire Maynilad Water Services, Inc. has started preparations for an initial public offering (IPO), targeting a listing no sooner than 2026, the company’s president said.

“It has to happen on or before January 2027, so we are looking at somewhere between after the elections or early 2026,” Maynilad President and CEO Ramoncito S. Fernandez said on the sidelines of an event in Bulacan on Tuesday.

Mr. Fernandez said the company is “still analyzing the numbers together with our advisors.”

“The paperwork has started; it has already been moved,” he said in Filipino.

Republic Act No. 11600, signed into law on December 10, 2021, granted Maynilad a 25-year legislative franchise until 2047 to establish, operate and maintain a water supply system and sewerage and sanitation in the service area of ​​the Western Zone of Metro Manila and Cavite Province.

The law also stipulates that Maynilad must offer at least 30% of its outstanding share capital within five years of the grant of the franchise.

“It is challenging to determine this because it is a mix of political, social and economic factors, with investors also taking into account factors such as sentiment and stability,” Mr Fernandez said when asked about the timing of the IPO after the elections.

Asked for comment, Juan Paolo E. Colet, chief executive of Chinabank Capital Corp., said. that Maynilad “has the foundations for an attractive IPO.”

“They just need to get two things right: the investment story and the timing,” he said in a Viber message.

“They can improve their IPO story by clearly explaining how they want to grow. It would also help enormously if they came up with an attractive overseas expansion strategy.”

He said carrying out a share offering in the next two years should give the company “a broad horizon to appropriately time its stock market debut.”

“A fully relaxed monetary policy between 2025 and 2026 that supports economic growth should be beneficial for the IPO market,” he said.

Maynilad is currently seeking an extension of its revised concession agreement with the Metropolitan Waterworks and Sewerage System from May 6, 2037 to January 21, 2047, to coincide with the term of its legislative franchise.

The company serves Manila, except parts of San Andres and Sta. Ana. It also operates in Quezon City, Makati, Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas and Malabon.

It also supplies the cities of Cavite, Bacoor and Imus, and the towns of Kawit, Noveleta and Rosario, all in the province of Cavite.

Metro Pacific Investments Corp., which owns a majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT Inc.

Hastings Holdings, Inc., a part of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in Business through the Philippine Star Group, which it controls. – Shelden Joy Talavera