MANILA Water Co., Inc. said on Friday that its consortium with a wholly-owned subsidiary signed a joint venture agreement with the water district of Ilagan City, Isabela for a bulk water supply project, which includes water system expansion and septage management.
In a disclosure to the stock exchange, the Ayala-controlled water company said the consortium Filipinas Water Holdings, Corp. with its unit Manila Water Philippine Ventures, Inc. (MWPV) executed the deal with the City of Ilagan Water District (CIWD).
The joint venture agreement (JVA) calls for the incorporation of a joint venture company (JVC) that will implement the development, construction, operation and maintenance of the project in the city within Isabela province.
Under the agreement, the consortium and CIWD will own 90% and 10%, respectively, of the joint venture company’s outstanding capital stock.
“Upon completion of conditions precedents set out in the JVA, the JVC will then enter into a Bulk Water Supply and Purchase Agreement and a Septage Management Agreement with the CIWD for the implementation of the Project for 25 years from the commencement date as defined in the JVA,” Manila Water said.
The joint venture partner’s subscription will be P22.5 million in cash and the paid-up amount will be P5.625 million. The water district will subscribe for P2.5 million, with P625,000 in paid-up capital. In total, the amount subscribed for is P25 million, with P6.25 million in paid-up capital.
Separately, Manila Water disclosed on Friday that subsidiary MWPV had signed and executed a joint venture agreement with Tubig Pilipinas Group, Inc. to handle the setting up of water supply facilities in Malasiqui, Pangasinan.
The agreement calls for the two companies to incorporate a joint venture company that will establish, construct, operate, manage, repair and maintain the facilities in the municipality.
The project was awarded to the joint venture through a grant of franchise under a municipal ordinance. The companies will own 50% and 50%, respectively, of the JVC’s outstanding capital stock with an initial subscribed capital of P35 million and paid-up capital of P8.75 million.
Upon completion of conditions precedent set out in the deal, the joint venture will execute the project for 25 years from the start date as defined in the agreement.
On Friday, shares in Manila Water rose 0.78% to P25.70 during mid-day trading. — Victor V. Saulon