METRO PACIFIC Investments Corp. (MPIC) is planning to issue exchangeable bonds in the coming months as it prepares the initial public offering (IPO) of its health care holding firm Metro Pacific Hospital Holdings, Inc. (MPHHI), its chairman said.
“The process has started for the hospitals,” MPIC Chairman Manuel V. Pangilinan told reporters, adding that a public listing is the “correct” direction for the business segment.
“I think we will eventually put it to bed, the IPO, hindi ko lang alam talaga kung ano’ng (I really don’t know) whether the schedule is firm enough that we can conclude it within the year,” he added.
MPIC’s health care segment includes operations and management of hospitals and nursing colleges and related enterprises under MPHHI and subsidiaries.
“We’re thinking of perhaps to be certain that we can raise the funds for MPIC and for the hospitals itself that maybe we should issue an exchangeable bond within the next two to three months that is convertible directly to the hospitals, to the hospital holding company,” he added.
An exchangeable bond consists of a straight bond and an option to swap the bond for the stock of the a company other than the issuer (for instance, the issuer’s subsidiary or affiliate) at a future date and under certain conditions.
Mr. Pangilinan said the size of the bond issuance would be around the same as the target proceeds of the IPO, which he did not disclose.
“Depends on what the estimated IPO proceeds are. So it’s got to be at some broad estimate. So that’s the size. It would be the same people who would buy the exchangeable [bonds] because what we are looking at is a mandatory exchange into MPHHI shares at pre-determined ratio,” he said.
Mr. Pangilinan said there was no update on The Medical City, which he described early this year “the last remaining major hospital in Metro Manila” for acquisition. He previously said that he had talked to the two camps disputing ownership of the hospital.
“We have not followed that up. I think the hospitals group is very busy with expanding in respect of hospitals, existing hospitals other than Medical City and with this IPO, the IPO fundraising (for MPIC),” he said.
MPIC’s hospital group comprises of full-service hospitals and a mall-based diagnostic and surgical center. It is the largest private provider of premier hospital services in the Philippines.
MPHHI is developing the Philippines’ first nationwide chain of hospitals to deliver comprehensive in-patient and out-patient hospital services, including medical and surgical services, diagnostic, therapeutic intensive care, research and training facilities in strategic locations.
Within its portfolio, eight are in Metro Manila: Makati Medical Center, Cardinal Santos Medical Center, Our Lady of Lourdes Hospital, Asian Hospital, De Los Santos Medical Center, Manila Doctors Hospital, Marikina Valley Medical Center Inc., and Dr. Jesus C. Delgado Memorial Hospital.
In other parts of the country, it has interest in Davao Doctors Hospital, Riverside Medical Center in Bacolod, Central Luzon Doctors Hospital in Tarlac, West Metro Medical Center in Zamboanga, Sacred Heart Hospital of Malolos, Inc. in Bulacan and St. Elizabeth Hospital, Inc. in General Santos City.
MPIC is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc. Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Victor V. Saulon