• Metro Pacific Investments Corp. (MPIC) and partner Keppel Infrastructure Trust (KIT) seek to acquire Philippine Coastal Storage & Pipeline Corp (PCSPC)
• MPIC will initially hold a 20% stake in PCSPC for a purchase consideration of US$67 million, with option to increase its interest up to 50%
• PCSPC is the largest independent petroleum products import storage facility in the Philippines
Metro Pacific Investments Corp. (MPIC), together with Keppel Infrastructure Trust (KIT), is moving to acquire Philippine Coastal Storage & Pipeline Corporation (PCSPC), the largest petroleum products import terminal in the Philippines.
MPIC and KIT have entered into a sale and purchase agreement with Philippine Investment Alliance for Infrastructure to acquire PCSPC, as MPIC sets out to expand its portfolio and revenue streams.
MPIC will initially hold a 20% stake in PCSPC’s parent company, Philippine Tank Storage International Holdings, Inc. (PTSI), for a purchase consideration of US$67 million. In addition, MPIC and Kit are in discussion to give MPIC an option to increase its interest in PCSPC up to 50%.
Through this investment, MPIC said it will be able to diversify its portfolio and revenue streams in a new industry vertical with strong growth potential. The company noted that PCSPC generates stable cash flows via take-or-pay contracts with high-quality off-takers.
“With PCSPC accounting for 36% of the total import terminal storage requirements of the Philippines, MPIC sees this facility as vital energy infrastructure for the country,” MPIC chairman Manuel V. Pangilinan said.
He added that MPIC and KIT “look forward to further expanding the capacity of PCSPC to provide millions of Filipinos with added energy security.”
Matthew Pollard, chief executive officer of Keppel Infrastructure Fund Management Pte Ltd., KIT’s trustee manager, said acquiring PCSPC will allow KIT to “diversify, grow and strengthen the resilience of KIT’s distributable cash flow.”
He noted that with the expected growth in demand for petroleum products in the Philippines, PCSPC presents an opportunity for KIT to “capture opportunities arising from the strong macroeconomic outlook as well as robust growth fundamentals for imported petroleum products in the Philippines.”
PCSPC is the largest independent storage facility in the Philippines, with a storage capacity of about 6 million barrels when it completes an expansion in early 2021.
The 150-hectare facility comprises 86 storage tanks, two piers and a pipeline infrastructure connecting the entire facility.
Located in the Subic Bay Freeport Zone, PCSPC provides a well-connected distribution hub to the largest economic catchment area—Metro Manila and north and central Luzon.
MPIC’s portfolio of infrastructure assets include power, toll roads, and water, as well as logistics, healthcare and light rail, which are all primarily located in the Philippines.
KIT’s portfolio of infrastructure assets, on the other hand, includes waste treatment, water desalination, power generation and transmission, piped gas production and retailing, and chemicals manufacture and distribution, which are primarily in Singapore and Australia.
