Philippine construction company Megawide Construction Corp. will use proceeds from the sale of its stake in Mactan Cebu International Airport to build 10 land transport terminals and enter new ventures including data centers, according to Chief Executive Officer Edgar Saavedra.
(Bloomberg) — Philippine construction company Megawide Construction Corp. will use proceeds from the sale of its stake in Mactan Cebu International Airport to build 10 land transport terminals and enter new ventures including data centers, according to Chief Executive Officer Edgar Saavedra.
Megawide will focus on building “pandemic resilient” infrastructure assets in the next three to five years, including re-development of public markets in towns and cities, Saavedra said at a briefing Friday. The builder can “always go back” to airports when travel returns to normal, he said. Gross proceeds from the disposal of the company’s interest in the Cebu facility amount to 15 billion pesos ($264 million).
“We now have a war chest to fund projects and pursue new opportunities,” Saadvedra said. “We have many projects in the pipeline.”
Megawide’s venture that runs the Mactan Cebu International Airport was forced to restructure debt because of the effects of the pandemic on its business. The company and its partner, India’s GMR Infrastructure Ltd., agreed to sell the airport venture for 25 billion pesos, with the Philippine company getting 60% of the proceeds.
GMR, Megawide Sell Mactan Cebu Airport Venture to Aboitiz
The sale will cut Megawide’s consolidated debt load, according to Jez dela Cruz, head of corporate finance. The venture’s liabilities include the 25 billion pesos it borrowed to construct the airport. Megawide originally invested 4.4 billion pesos for its 60% stake in the unit, which started in 2014.
Megawide plans to build the land transport terminals across the country over the next three years, adding to the integrated bus hub it runs in capital Manila, Chief Financial Officer Ramon Diaz said in an interview with Bloomberg. Each terminal could cost a billion pesos, he said, adding that the sites have already been identified and contracts for three hubs are underway.
Megawide’s non-affiliation with the nation’s telecommunications companies is an advantage for its data centers since many potential locators are “telecoms neutral,” said Jaime Raphael Feliciano, chief business development officer.
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