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MPIC sells 34.9% stake in LRT-1 to Sumitomo

By James A. Loyola

Metro Pacific Investments Corporation (MPIC) has sold 34.9 percent of its 55 percent stake in the LRT 1 Project to Japanese giant Sumitomo Corporation for ₱3 billion in cash.

In a disclosure to the Philip¬pine Stock Exchange, MPIC said Sumitomo has acquired a strategic stake in Metro Pacific Light Rail Corporation (MPLRC) that holds an effective 55 percent stake in Light Rail Manila Corporation (LRMC).

LRMC has a 32-year concession from September 12, 2015 to operate, maintain and extend the 20.7 km LRT-1, a vital light rail infrastructure asset in the heart of Metro Manila. LRT-1, currently with 20 stations, has started works on the extension of the system to Cavite. “MPIC welcomes Sumitomo as a strategic stakeholder in the LRT1 project along with its current partners AC Infrastructure Holdings Corporation and Macquarie Investments Holdings (Philippines) Limited,” said MPIC Chairman Manuel V. Pangilinan.

He noted that, “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.”

“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 Sumitomo General Manager for Transportation Systems & Infrastructure Business Dept. Eita Fujikawa.

He added that, “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.”

MPIC, through MPLRC, is expected to benefit from the global rail expertise of Sumitomo Corporation while at the same time enabling MPIC to share its equity commitment for the Project with a strategic investor. The transaction is expected to strengthen the balance sheet of MPIC.

“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 ensure that we deliver Phase 1 of the Cavite Extension as fast as possible,” said LRMC President and CEO Juan Alfonso.


Source: Manila Bulletin (https://business.mb.com.ph/2020/05/31/mpic-sells-34-9-stake-in-lrt-1-to-sumitomo/)

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