San Miguel buys out partner in $1.6B MRT7 project
MANILA, Philippines – Diversified conglomerate San Miguel Corporation has bought the remaining 49% stake owned by businessman Salvador Zamora in the $1.6-billion Metro Rail Transit Line 7 (MRT7) deal.
The deal, worth $100 million, resulted in San Miguel owning 100% of the company which holds the exclusive right to design, construct, and complete the MRT7.
San Miguel told the Philippine Stock Exchange that its wholly owned subsidiary San Miguel Holdings Corporation executed on June 16 an amended and restated share sale and purchase agreement with Universal LRT Corporation Limited and the Zamora group for the purchase of an additional 49% equity interest in Universal LRT Corporation BVI Limited (ULC BVI) and 100% equity interest in ULCOM Company Incorporated.
"The total consideration for the acquisitions of ULC BVI and ULCOM is $100 million which amount consists of payment for the sales as well as the outstanding shareholder advances made by each of ULC HK and Mr. Zamora to ULC BVI and ULCOM, respectively," San Miguel said.
ULC BVI holds the exclusive right, obligation, and privilege to finance, design, construct, supply, complete, and commission the MRT7 project by virtue of its concession agreement with the government dated June 18, 2008.
ULCOM, meanwhile, is the designated facility operator of the MRT7 project.
San Miguel Holdings' acquisition of ULC BVI and ULCOM was completed July 1.
"With the completion of such acquisition, SMHC now owns 100% interest in ULC BVI and ULCOM," San Miguel said.
It was in November 2010 when San Miguel acquired 51% equity interest in Universal LRT.
After achieving financial close, San Miguel last April broke ground for the MRT7 project, which involves the construction of a 23-kilometer elevated train line from San Jose del Monte in Bulacan to the corner of North Avenue in Quezon City.
The project will be completed in 3 to 4 years with the assistance of Hyundai Rotem and EEI consortium. (READ: Construction of MRT7 finally starts)
The MRT7 will have 14 stations which will only take 30 minutes to travel end-to-end. It will also connect to the MRT3 and LRT1, and is expected to serve over 800,000 passengers daily. – Rappler.com