Metro Pacific to relaunch logistics arm

Manuel V. Pangilinan-led Metro Pacific Investments Corp. is looking at potential acquisitions in the P20-billion cold chain sector to support its budding agribusiness portfolio.

This was part of the infrastructure giant’s broader plan to relaunch its logistics segment, which is being restructured after investments in large-scale warehousing did not pan out.

The cold chain sector includes cold storage facilities, which are temperature-controlled warehouses designed to maintain the freshness of perishable products like food for extended periods.

During a media briefing last week, Metro Pacific chief finance officer June Cheryl Cabal-Revilla said they were looking at logistics as a complementary business given its recent focus on agriculture and food security.

“For agriculture, you need cold storage, which we did not have before. It was really just the warehousing business,” Revilla said.

“We are looking at certain cold storage businesses,” she added.

Juan Victor Hernandez, CEO of Metro Pacific Agro Ventures Inc., said investments in cold storage might involve acquisitions but he did not provide details.

“While we produce the best [food] products out there it’s important we are able to distribute to the Filipino consumer,” said Hernandez, who also heads Metro Pacific’s logistics division.

“It ties in with agriculture,” he added.

Fragmented sector

The cold chain industry could be worth as much as $417 million this year, according to an estimate by the Board of Investments.

Cold chain operators are also fragmented, with no single player controlling dominant market share.

The biggest operator is Jentec Cold Storage, with a share of 19 percent, followed by Glacier Megafridge, with a market share of 13 percent, according to 2020 data from third-party research firm Ken Research.

The next five largest companies each controls less than 10 percent of the market.

Acquisitions

Metro Pacific said it would continue to aggressively expand in agriculture as it set aside about P8 billion for agribusiness acquisitions this year.

It earlier purchased a controlling stake in the Carmen’s Best dairy group from the Magsaysay family and sealed two ventures with Israel’s LR Group to establish modern dairy and vegetable farms in the Philippines.

Metro Pacific also recently announced the acquisition of a 34.7-percent stake in listed coconut processing and exports firm Axelum Resources Corp.

Hernandez said investments in Carmen’s Best were starting to pay off.

“Carmen’s is doing quite better, we made a small profit last year,” he said.

On Feb. 20, Metro Pacific held a groundbreaking ceremony with LR to build the country’s biggest greenhouse in Bulacan that was capable of producing an annual 1,600 metric tons of vegetables by 2024.

In December, it also started to build a P2-billion modern dairy farm in Laguna, that can produce six million liters of milk per year by 2026. INQ