AYALA CORP. HAS AGREED to buy P3.5 billion worth of additional common and preferred shares of Manila Water Co. from British partner United Utilities Pacific Holdings BV.

This will jack up Ayala Corp.?s economic interest in Manila Water to 43.3 percent.

The conglomerate, which currently owns 31.7 percent of Manila Water, signed yesterday an agreement to acquire 81.9 million common shares and two billion preferred shares from UU, thereby raising its stake by 11.6 percentage.

In a disclosure to the Philippine Stock Exchange yesterday, Ayala senior managing director Rufino Luis Manotok said UU would continue to provide technical services to Manila Water and retain voting rights in the water company through Philwater Holdings Co. (Philwater), which holds Manila Water?s outstanding preferred shares.

Philwater is 60 percent owned by Ayala and 40 percent controlled by UU, which has been the group?s technical partner in Manila Water since it began operating the concession in Metro Manila?s east zone in 1997.

Manila Water recently obtained the approval of Metropolitan Waterworks and Sewerage System for the renewal of its concession.

With the concession extended up to 2037, Manila Water has committed to implement a P450-billion investment plan for the east zone?which covers parts of Manila, San Juan, Taguig, Pateros, Antipolo, Taytay, Jala-Jala, Baras, Angono, San Mateo, Rodriquez, Marikina, Pasig, Mandaluyong, Makati and most of Quezon City.

?The company continues to tap opportunities beyond the East Zone,? Manotok said.

It recently took over the water concession of Sta. Rosa, Biñan and Cabuyao in Laguna and entered into a joint venture agreement with the Philippine Tourism Authority to develop the water distribution and sewerage facilities in Boracay. Doris C. Dumlao