THE AYALA GROUP plans to expand its automotive dealership business after making a bid to secure the rights to distribute South Korean car brand Kia in the Philippines.
In a disclosure to the stock exchange on Wednesday, the conglomerate said the group emerged as the “preferred bidder” to begin negotiations for the Kia distributorship in the Philippines, but no definitive deal has been reached.
A wholly owned subsidiary of Ayala, AC Industrial Technology Holdings, Inc., through one of its group companies, received the notice from the regional headquarters of Kia Motors Asia.
Kia has a stable of brands comprised of Picanto, Rio 5-door, Soul, Sportage and Sorento and Grand Carnival.
The Ayala group consolidated its automotive and manufacturing assets under AC Industrials last year after transferring its ownership of Integrated Micro-Electronics, Inc. (IMI) to its wholly owned subsidiary.
AC Industrials holds the group’s interests in automotive dealerships and distributorships for Honda and Isuzu as well as a 100% stake in Automobile Central Enterprise, Inc. (ACEI) and a 100% interest in Adventure Cycle Philippines, Inc. (ACPI).
ACEI is the official importer and distributor of Volkswagen vehicles in the Philippines, while AC Industrials also manufactures KTM motorcycles and, through ACPI, is the official distributor of KTM motorcycles in the Philippines.
The Ayala group has a five-year target to hit a net income of P50 billion by 2020, banking on the growth of its core and relatively newer businesses.
The conglomerate’s attributable profit stood at P23.2 billion in the first nine months of 2017, 18% higher year on year, following a 21% increase in revenues to P170 billion during the period.
Ayala Corp. has diversified business interests that include real estate, financial services, telecommunications, water infrastructure development and electronics manufacturing. It has recently entered new sectors with investments in power generation, transport infrastructure development, health care, education and e-commerce.
Shares in Ayala climbed P29 or 2.89% to settle at P1,034 apiece on Wednesday. — Krista Angela M. Montealegre