In a stock exchange filing on Wednesday, Megawide transferred its remaining stake in the airport venture to Aboitiz InfraCapital Inc., part of the family-led conglomerate Aboitiz Equity Ventures, which made its initial investment in the gateway in 2022.
The Megawide’s remaining stake of about 33.3 percent was worth P7.76 billion. After the transaction, Aboitiz InfraCapital has gained full control of the airport project.
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The deal was part of the construction and engineering group’s portfolio realignment and debt reduction program.
Megawide and partner GMR Infrastructure of India successfully edged out some of the country's biggest conglomerates during a public auction in 2013. The group eventually won the MCIA PPP project, which paved the way for the transformation of the Cebu gateway into a world-class airport.
But the business also faced challenges, especially during the COVID-19 lockdowns that halted flights during the global health crisis.
Focus on infrastructure, engineering
“As an infrastructure innovator, the completion of the airport transaction facilitates our natural progression into property development and allows us to focus on our precast and construction solutions (PCS) unit – which serves as our unique competitive advantage against other industry players – and our other infrastructure projects, including the Parañaque Integrated Terminal Exchange (PITX),” Saavedra, the chair and CEO of Megawide, said in a statement on Wednesday.
“At the same time, this strengthens our balance sheet and forms part of our medium-term financial management program,” he added.
Stronger balance sheet
The company said this latest deal enhances liquidity. It will also improve the current ratio, which measures the company’s ability to meet short-term obligations, to 1.54 times at the end of this year.
The current ratio, which stood at 1.29 times as of Dec. 31, 2023, is projected to increase to 1.54 times by Dec. 31, 2024, post-transaction.
Aboitiz expands airport portfolio
The deal allows Aboitiz to consolidate control over MCIA, its most important airport asset.
Earlier this week, the conglomerate also signed an agreement for the 30-year modernization and development of the Laguindingan International Airport in Misamis Oriental, Northern Mindanao’s main air gateway.
Megawide remains active in infrastructure
Megawide, which continues to operate the PITX, also delivered 10,000 classrooms for the Department of Education’s PPP for School Infrastructure project.
The company also completed the design and construction of the new Clark International Airport passenger terminal building, and is currently building Malolos-Clark Railway Package 1 and Metro Manila Subway Project Contract Package 104.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
