MANILA, Philippines – Embattled Manila Water Company Incorporated is planning to raise P9 billion by selling more shares, as the Philippine government reviews its concession agreement.
Manila Water’s board of directors held a meeting on Friday, January 31, and approved to raise capital and funding amid government pressures on the company.
“This move will give flexibility to the company to raise additional capital and funding when needed. Our access to different funding sources will allow us to be deliberate and to take decisive actions as needed. The present circumstances require us to be proactive and ready with different alternatives and options,” Manila Water said.
The company intends to increase its authorized capital stock of P3.5 billion to P4.4 Billion, which increase will consist of an additional 900 million common shares.
The board also decided to increase the carved-out shares from 300 million unissued common shares to 900 Million unissued common shares. (READ: Risky business: Why gov’t made sure Manila Water, Maynilad would earn)
Finally, the board approved to allow the issuance of the carved-out shares “for cash, properties, or assets to carry out” the corporate purposes.
These will be presented to stockholders for approval at the annual meeting on April 17, 2020.
The board likewise approved a minimum selling price of P10 per share for issuance of common shares in the event the company decides to issue common shares.
Shares of Manila Water were on voluntary trading suspension the entire Friday, as the board held its meeting. Shares jumped by over 13% on Thursday. (READ: Down the drain: Manila Water, Maynilad owners' shares plunge to near-decade low)
Justice Secretary Menardo Guevarra said talks are “moving faster than expected.”
“We'll soon get inputs on the commercial and financial aspects. the committee tasked to review the water [concession agreements] will meet again on Monday,” Guevarra said. – with reports by Lian Buan/Rappler.com