MANILA WATER Co., Inc. is expanding its footprint in Indonesia, as a subsidiary acquires a 20% stake in a bulk water company that serves part of Central Java province.
In a disclosure to the stock exchange, the Ayala-led company said its subsidiary PT Manila Water Indonesia (PT MWI) signed the share purchase agreement with PT. Triguna Rapindo Mandiri to acquire 4,478 shares of PT. Sarana Tirta Ungaran (STU).
The move will allow PT MWI to own 20% of the outstanding capital stock of STU, it said.
Metro Manila’s east zone water concessionaire described STU as a bulk water supply company serving PDAM Kabupaten Semarang and industrial customers in Bawen, located in Ungaran area of Semarang Regency, Central Java Province, with a capacity of 21.5 million liters per day.
“[T]his acquisition expands our footprint in Indonesia, after the successful completion of our showcase leakage reduction project in Bandung in 2017. This clearly demonstrates our continued interest in the Indonesian market and provides an opportunity to further strengthen our growth platform and harness the vast potential for synergies within the ASEAN region,” said Virgilio C. Rivera, president of Manila Water Asia Pacific Pte. Ltd., in a statement.
The unit holds Manila Water’s investments in various project companies in the region.
Manila Water will use internally generated funds to finance the transaction.
The deal comes less than a month after Manila Water signed a share purchase agreement to acquire an 18.72% stake in a publicly listed water supply and distribution company in Thailand.
The company said the stake in Eastern Water Resources Development and Management Public Co. Ltd. is its first point of entry in Thailand as part of the its expansion in Southeast Asia.
Manila Water’s entry in Thailand and Indonesia comes after its foray into bulk water and concession projects in Vietnam, where it has become largest direct foreign investor in that country’s water sector supplying half of the bulk water requirements of Ho Chi Minh City.
Shares in Manila Water rose 55 centavos or 2.12% to P26.55 each. — Victor V. Saulon