Manila Water Company

Some 10,000 residents of Project 6 in Quezon City will soon get a boost in their piped-in-water supply courtesy of a major mainline and service pipe replacement program by Manila Water Company of the decades-old distribution network in this historic community. Photo shows Manila Water Company president Tony Aquino (center) with Quezon City Mayor Sonny Belmonte at the program’s recent groundbreaking. The pipeline rehabilitation program is part of the Ayala-led concessionaire’s P15 billion gameplan in the next five years to expand and improve service in the east zone of Metro Manila, and provide water to an additional one million population.

Manila Water Company to Increase Capital

Manila Water Company (MWC) announced an increase in its authorized capital stock from P2 billion to P4 billion pesos, the increase to be partially funded out of P500 million pesos in new preferred equity infusion. At the special MWC Board and Stockholders� meetings called on August 28, 2003, the Company shareholders approved the doubling of its capitalization, preparatory to a planned Initial Public Offering (IPO) and as part of a major capital restructuring. The Board likewise voted for MWC to purchase the beneficial ownership in MWC of the International Water S.a.r.l (formerly BEn MWSS Holdings Ltd.), or IWL, a subsidiary of US-based Bechtel Corporation and Edison SpA. MWC�s acquisition of the IWL shares further stabilizes the Company�s capital base with its shareholders, including Ayala Corporation and United Utilities (the international operator based in U.K.), increasing their respective stakes in the company. The increase in capital will be implemented after completion of MWC�s acquisition of IWL�s ownership interest in the Company. The fresh infusion of P500 million in preferred equity from MWC’s shareholders, namely Ayala, United Utilities and BPI Capital Corporation, also reinforces the group’s continued confidence in the sustained growth and financial strength of the water company. Said MWC chairman Fernando Zobel de Ayala: �We regret the divestment decision of one of our strategic investors. However, the remaining shareholders are pleased with the opportunity to demonstrate our renewed and increased commitment to MWC which has performed very well in spite of the challenging business environment.� The company ended the previous year with positive net income results, and recently closed a US$30 million financing package from World Bank subsidiary, International Finance Corporation (IFC).