Manila Water expands in Indonesia

Ayala-led Manila Water Co. Inc. is expanding in Indonesia after the acquisition of a 20 percent stake in another bulk water supplier in the ASEAN neighbor as part of its plan to strengthen its foothold in the region.

In a regulatory filing, Manila Water said PT Manila Water Indonesia (PTMWI), a 95 percentowned subsidiary, signed a share purchase agreement to acquire 4,478 shares of PT. Sarana Tirta Ungaran (STU).

The purchase will allow Manila Water to own 20 percent of the outstanding capital stock of STU.

STU is a bulk water supply company servicing PDAM Kabupaten Semarang and industrial customers in Bawen, located in Ungaran area of Semarang Regency, Central Java province.

It has a capacity of 21.5 million liters per day. Its customers include PT. APAC Inti Corpora, a 100-hectare textile and garment manufacturing company.

Manila Water intends to finance the transaction through internally generated funds.

The water company’s expansion in Indonesia comes after its foray into bulk water and concession projects in Thailand and Vietnam, where it is now the largest direct foreign investor in Vietnam’s water sector supplying half of the bulk water requirements of Ho Chi Minh City.

It has also completed pilot projects in Bandung in Indonesia for a non-revenue water reduction program and in Yangon in Myanmar for leakage reduction.

Manila Water reported flat earnings last year at P6.1 billion.

Total billed volume rose three percent to 741.1 million cubic meters (mcm) across all units, driven by the strong topline of the Manila concession and the expansion of its domestic operating subsidiaries.

The company spent P13 billion last year, up by nearly 50 percent, following intensified infrastructure build-up to lay additional groundwork for future growth.