Japan’s Mitsui, First Pacific raise offer for Philippines’ Metro Pacific

By Neil Jerome Morales and Jaskiran Singh

MANILA (Reuters) -Japan’s Mitsui, Hong Kong’s First Pacific and their partners on Tuesday lifted an offer to buy out minority shareholders in Philippine infrastructure firm Metro Pacific to as much as 54.8 billion pesos ($990.7 million).

In separate disclosures, the buyers offered 5.20 pesos per share, up 12% from a previous offer that resulted in backlash over what minority shareholders deemed a low valuation for the firm with interests in power, water, hospitals and toll roads.

The latest offer price represents a 22% premium to Metro Pacific’s last close on April 26, before the offer was first disclosed, and is 37% higher versus a one-year weighted average price.

The deal would see the acquisition of up to 36.6% of Metro Pacific’s shares owned by minority public stockholders by a consortium that includes Mitsui, Japanese government-backed fund JOIN, First Pacific, and their Filipino partners.

“It signals an earnest desire by the offerors to listen to the market’s clamour for a fair price,” Juan Paolo Colet, managing director of investment bank China Bank Capital in Manila said of the increased price.

Many minority shareholders will seriously consider selling shares amid a prospect of prospect of holding a perennially undervalued stock, Colet added.

The deal further hinges on stockholders approving in August the delisting of Metro Pacific’s common shares from the Philippine bourse.

Metro Pacific has long been considered a target for strategic investment and privatisation owing to its cheap valuation.

Indonesian tycoon Anthoni Salim’s First Pacific, an investment holding firm listed in Hong Kong, owns 46% already.

Mitsui and JOIN combined would take up to 20% of Metro Pacific if the offer is successful, with the remainder to be bought by existing shareholders including First Pacific and other Filipino partners.

Metro Pacific’s shares were suspended from trading on Tuesday.

($1 = 55.29 Philippine pesos)

(Reporting by Jaskiran Singh in Bengaluru and Neil Jerome Morales in Manila; Editing by Rashmi Aich and Jamie Freed)