Ayala-led Manila Water Co. Inc. has inked a seven-year long-term loan facility with three Japanese banks, with the funds earmarked for capital expenditures focused on improving its services.
In a statement, the water concessionaire said the ¥40-billion (P15.57 billion) facility would be funded by The Bank of Tokyo-Mitsubishi UFJ Ltd., Mizuho Bank Ltd. and Sumitomo Mitsui Banking Corp. The deal was signed yesterday.
It was described as Manila Water’s single largest capital raising activity following the April approval of a rate rebasing business plan, and also the longest-tenured unguaranteed yen loan facility extended by the Japanese banks to a Philippine company.
“The proceeds of the term loan facility will be used to partly finance Manila Water’s capital expenditures, which include used water projects such as new sewerage treatment plants and rehabilitation of sewer lines,” the company said.
“In addition, the loan will also facilitate the development of new water sources and the rehabilitation of water treatment plants and distribution networks to ensure reliability during natural disasters. These projects will enable the company to continuously provide the highest quality of water and used water services to its customers in the East Zone concession area,” the firm added.
Manila Water has budgeted P5 billion in capex for its East Zone concession this year, with plans to allocate more than P10 billion in 2016 and beyond.
Manila Water services parts of Quezon City, Manila, Marikina, Pasig, San Juan, Mandaluyong, Makati, Taguig, Pateros and Rizal province.