MANILA -Tycoon Edgar Saavedra’s Megawide Construction Corp. is diversifying into real estate development through the acquisition of an affiliate company, boutique builder PH1 World Developers for P5.2 billion.
Megawide, one of the country’s biggest construction and engineering firms, said in a regulatory filing on Wednesday the deal was approved by its board of directors on July 4. It would then seek the approval of stockholders during its upcoming annual meting on July 12.
PH1 World Developers is owned by Saavedra’s Citicore Holdings Investments Inc. Its projects include The Hive, My Enso Lofts, Modan Lofts Pasco, and Modan Lofts Ortigas Hills.
Because it is a related party, the firm hired third-party valuation firm FTI Consulting Philippines to provide a fairness opinion.
FTI’s report, which was also made public, showed that PH1 World Developers’ estimated value range was from P3.82 billion to P6.2 billion.
The report also considered the builders’ investments in projects via PH1 World Landscapes Inc. and Farmtech Properties Inc.
Megawide is entering new business lines after earlier announcing its gradual exit from the the Mactan Cebu International Airport project.
With partner GMR Infrastructure of India, Megawide completed the P25-billion sale to the Aboitiz family’s Aboitiz Equity Ventures Inc., which will gain full ownership of the airport project in October next year.
READ: Megawide GMR closes sale of Cebu airport to Aboitiz Group
Its other projects include the construction contract for a portion of the country’s first subway system in Metro Manila and is also a data center in Cavite province.
It cut losses during the first quarter of 2023 by over 90 percent to P7.1 million as revenues rose over 11 percent to P4.36 billion versus the same period last year.
READ: Megawide swings back to profitability