The Ayala Group has formally ceded control over Manila Water Company to Enrique K. Razon Jr. following an agreement wherein the tycoon bought a 24.96 percent stake but was given voting power for 51 percent of the utility.

Enrique K. Razon Jr.

In a disclosure, Manila Water advised the Philippine Stock Exchange of the change in its controlling shareholder from the Ayala’s Philwater Holdings Company (PHC) to Razon’s Trident Water Company Holdings Inc.

The change in control has been reflected in the resignation of top Ayala officials, led by the Zobel brothers, from Manila Water’s Board of Directors. They were replaced by Razon and his appointees.

Resigned were Chairman Fernando Zobel de Ayala, Vice Chairman Jaime Augusto Zobel de Ayala, President and CEO Jose Rene Almendras, Director Delfin L. Lazaro, Executive Committee member Antonino T. Aquino, Director Gerardo Ablaza Jr., Director John Eric Francia, Virgilio C. Rivera, and Solomon Hermasura.

Elected or appointed to replace them are Razon as Chairman, President and CEO; as well as Director Donato Almeda, Director Christian Gonzalez, Director Rafael Consing, Eric Recto, Roberto Locsin, Melvin John Tan, and Silverio Tan.

Chief operating officer for Manila Water Operations Abelardo Basilio was redesignated Chief Operating Officer for the East Zone while Sherisa Nuesa was moved to the Corporate Governance Committee and Remunation Committee from the Executive and Operations committees.

On February 1, 2020, Razon’s Prime Metroline Holdings, Inc. (now known as Prime Strategic Holdings Inc.), on behalf Trident, signed a subscription agreement with MWC for 820 million MWC common shares at P13 per share.

The subscription represented approximately 11.91 percent of the resulting total issued and outstanding capital stock of MWC and 24.96 percent of the economic rights in MWC.

The Subscription Agreement includes a grant by Philwater to Trident of proxy rights over a bloc of preferred shares in MWC to give Trident 51 percent voting interest in MWC. 

In an amendment to the Subscription Agreement dated February 15, 2021, the payment terms of the subscription was amended to 50 percent or P5.33 billion to be paid on Closing and the remaining 50 percent upon call by the board of directors of MWC.

On February 15, 2021 Trident agreed to buy 2.69 billion preferred shares in MWC from PHC for a total purchase price of P4.84 billion under a Share Purchase Agreement, payable over five years.

Pending full payment of the purchase price PHC agrees to issue a proxy over the subject preferred shares in favor of Trident.

The purchase of the 2.69 billion preferred shares, in addition to its subscription to 820 million common shares, gives Trident a total 51 percent voting interest in MWC.

Trident conducted a mandatory tender offer for 1.12 billion common shares of MWC, approximately 54.16 percent of the outstanding common shares, from all shareholders, excluding the 867 million common shares held by Ayala Corporation and its nominees and the 4 billion preferred shares held by Philwater.

Source: Manila Bulletin (