Maynilad to borrow P6B

Water concessionaire Maynilad Water Services Inc. is borrowing P5 billion to P6 billion this year to fund new projects and pre-pay certain loans to take advantage of the low interest rate environment.

BDO Unibank, the country’s biggest lender, may be tapped for the fundraising plan.

“Maynilad will do some refinancing in the first quarter. It will be a combination of new debt and re-pricing of old debt. We want to pay (loans) earlier,” said Metro Pacific Investments Corp. (MPIC) chief financial officer David Nicol said.

MPIC and partner DMCI Holdings own Maynilad, the concessionaire for the West Zone of the Greater Manila Area.  He said the company would pay back loans that were maturing within a “couple of years.”

Maynilad earlier announced earmarking P9.3 billion for the management and development of its wastewater projects in 2013.

This is more than triple its P2.7-billion wastewater budget last year. Maynilad’s wastewater projects will be funded by internally generated funds and a loan from the World Bank.

Of the P9.3-billion budget, more than P5.6 billion will be for the construction of new sewage treatment plants (STP) in Quezon City, Valenzuela, Pasay and Muntinlupa. Once completed, these STPs can treat a volume of 197.5 million liters of wastewater per day (MLD), benefiting more than one million people in the West Zone.

A new Septage Treatment Plant (SPTP) with a treatment capacity of 250 cubic meters per day (cmd) will also be constructed in south of Manila.

Some P1.8 billion will be used for the installation of new sewer lines in Valenzuela and Muntinlupa that will collect wastewater and convey it to Maynilad’s STPs for treatment.

The remaining fund will be used for the rehabilitation of lift stations in Muntinlupa,  upgrading of more than 150 manholes in Central Manila and Alabang, acquisition of land for additional facilities and enhancement of the Dagat-Dagatan Sewage and Septage Treatment Plant in Caloocan.

“In the past five years we concentrated our investments on water because it was what our customers needed more. Now that we have transformed water services in the West Zone, our challenge is to expand our sewerage coverage. It’s going to be very demanding but I believe that our people are up to it,” Maynilad president and CEO Ricky Vargas said.