Megawide Construction Corp. on Wednesday announced that it will exchange its more 33 percent share in Aboitiz GMR Megawide Cebu Airport Corporation (AGMCAC) for P7.76 billion in a deal with Aboitiz InfraCapital Inc. (AIC).
The transaction is projected to boost Megawide’s liquidity from 1.29 times to 1.54 times when completed. Edgar Saavedra, chairman and CEO of Megawide, said the move aligns with the pivot towards property development and bolster its precast and construction solutions (PCS) unit. “This transaction strengthens our balance sheet and is a vital part of our medium-term financial management program,” Saavedra said.
Post-transaction, Megawide’s consolidated debt-to-equity ratio is projected to improve significantly to 1.9 times, down from 2.6 times. Proceeds from the airport deal will help facilitate the acquisition of PH1 World Developers, Inc. in July, allowing Megawide to expand into the resilient housing market.
The agreement follows a share subscription and transfer agreement among Megawide, GMR Airports International BV, and AIC, which includes the issuance of exchangeable notes related to the remaining 66 and 2/3 percent plus one share of AGMCAC’s outstanding capital stock, valued at P15.5 billion.
As a key infrastructure partner of the Philippine government, Megawide is involved in numerous projects, including the delivery of 10,000 classrooms for the Department of Education’s PPP for School Infrastructure Project and the construction of the new Clark International Airport passenger terminal building. The company is also working on the Malolos-Clark Railway Package 1 and the Metro Manila Subway Project Contract Package 104.
