Ayala Group to acquire 65% of Columbian Autocar
The Ayala Group plans to acquire a 65 percent stake in Columbian Autocar Corp., the assembler and exclusive distributor of Kia vehicles in the Philippines, a move that would expand its portfolio of automotive brands in the country.
Businessman and Palawan Governor Jose “Pepito” Alvarez, the founding chairman of Columbian Autocar, meanwhile, will keep a 35 percent stake in the company, industry sources told The STAR.
The two parties are expected to conclude the deal within 60 days, sources also said.
The agreement will seal Ayala’s acquisition of Columbian Autocar and would now have the rights to distribute the Kia brand in the Philippines, which industry players said has become as popular as Japanese automotive cars since entering the Philippines almost 30 years ago.
Ayala beat Davao-based businessman Dennis Uy and businessman Salvador “Buddy” Zamora, who both expressed interest in the Kia business in the Philippines.
Industry sources said Ayala made a better deal and was the one that had the blessing of Kia Motor Asia’s regional headquarters.
In February, Ayala received a notice from Kia Motors that it was the “preferred bidder” to start negotiations for the Kia distributorship in the Philippines.
The deal, once finalized, would enable the conglomerate to expand its automotive distribution business which already includes other big names in the global market such as Honda, Isuzu, Volkswagen, and KTM motorcycles. Last year, Columbian Autocar sold 5,186 units, down 29 percent from 7,304 units in 2016, according to data from the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI).
Alvarez’s deal with Ayala is similar to the arrangement he made with San Miguel Corp., for his BMW distributorship business in the Philippines.
SMC acquired a 65 percent stake in Asian Car Makers, the distributor of European luxury car BMW in the Philippines. SMC president and COO Ramon Ang is a known car enthusiast.
Columbian Autocar started in 1994 and has been a major player in the Philippine car industry since then.
According to its profile on the website of CAMPI, Kia has at least 39 dealerships nationwide.
Alvarez, at present, spends most of his time attending to his gubernatorial duties in Palawan. Industry sources said he decided to sell both the BMW and Kia brands so he no longer has to oversee the transition of his vehicle business to electric vehicles from the normal gasoline.
Ayala, through newly formed unit AC Industrials, has been growing its portfolio of businesses that develop, enable, manufacture, and commercialize automotive and other industrial technologies.
AC Auto, the automotive arm, formed a joint venture with KTM, the world’s largest Austrian-based motorcycle manufacturer. Since June 2017, some 1,800 units have been produced in IMI’s facility in Laguna including a number for export to Thailand and Vietnam.