Sumitomo Corp. of Japan acquired a 34.9-percent stake in Light Rail Manila Corp. which operates Light Rail Transit Line 1 for P3 billion.
“MPIC welcomes Sumitomo as a strategic stakeholder in the LRT1 project along with its current partners AC Infrastructure Holdings Corp. and Macquarie Investments Holdings (Philippines) Limited,” said Manuel Pangilinan, chairman of Metro Pacific Investments which is the majority owner of LRMC.
“This investment by Sumitomo is a welcome illustration in their belief in the future of this project. We are all eager to resume operations of LRT-1 when the current extended quarantine is released,” Pangilinan said.
MPIC, through Metro Pacific Light Rail Corp., owns a 55-percent stake in LRMC which has a 32-year concession from Sep. 12, 2015 to operate, maintain and extend the 20.7-kilometer LRT-1, a vital light rail infrastructure asset in the heart of Metro Manila.
LRT-1, currently with 20 stations, started works on the extension of the system to Cavite.
Ayala Infra Holdings Corp. owns 35 percent in LRMC while Macquarie Infrastructure Holdings (Philippines) Inc. has 10 percent.
MPIC said the company would benefit from the global rail expertise of Sumitomo. It said the transaction would enable the company to share its equity commitment for the project with a strategic investor.
“We are delighted to partner with MPIC, to invest in the LRT1 project, and contribute to the development of rail infrastructure in the Philippines. Sumitomo is keen to share our 100 years worth of global investment and operational experience,” said Eita Fujikawa, Sumitomo’s general manager for transportation systems and infrastructure business department.
“We are confident that our investment and expertise will provide the support the expanding Manila public transit infrastructure needs to grow and to bring local communities even closer through the Cavite extension. We thank MPIC for this unique opportunity, and we look forward to many years of future investment in the Philippines,” Fujikawa said.
LRMC president and chief executive Juan Alfonso said the transaction was a testament of their shareholders’ dedication to further improve LRMC.
“Sumitomo’s investment will significantly contribute to the efficiency of our current operations and assist us as we continue heavy works on the Cavite extension. The investment helps us further enhance the ridership experience of our passengers and will support to ensure that we deliver Phase 1 of the Cavite Extension as fast as possible. We are excited to have Sumitomo onboard,” Alfonso said.
Macquarie Capital and SyCip Salazar Hernandez & Gatmaitan acted as advisors of MPIC.