MacroAsia Corp. said it plans to spin off its water business in preparation for an initial public offering within three years.
“There is no specific date yet, but the general plan is to list it [at the Philippine Stock Exchange] within three years. We are currently transferring the holding of our water companies from MacroAsia Properties Development Corp. to a new water holding company,” MAC chief financial officer Amador Sendin said.
“The intention of MacroAsia is to focus on its core segments which are related to aviation services. The capital allocation policy for the water segment is entirely different from the aviation services, so we have to separate this. That’s the reason for the separation or the spin-off,” he said.
Sendin said the MacroAsia was building up the revenue and profit base of its water business in preparation for the IPO.
Revenues from water operations contributed 8 percent to the total revenue of MAC. Water revenues rose 90 percent to P271.04 million in 2018 from P142.65 million in 2017.
The growth was attributed to MAC’s acquisition of Summa Water Resources Inc., a company engaged in water treatment and equipment lease, in October 2018.
Naic Water Supply Corp., an operating water utility company in Naic, Cavite which MAC acquired in August 2017 contributed P26.14 million in revenues. The customer growth of SNV Resources Development Corp. also supported the water business.
Revenue contribution from Boracay Tubi System Inc. grew despite the temporary closure of Boracay Island last year.
MAC president and chief operating officer Joseph Chua said these water businesses would provide the diversification needed to boost the company’s growth beyond the aviation sector.
“Together with the aviation businesses, we foresee a strong base to generate shareholder value,” he said.
MAC is also involved in aircraft maintenance, repair and overhaul, catering, ground handling and mining.
MAC posted a net income of P1.08 billion in 2018, up 2 percent from P1.06 billion in 2017. Consolidated revenues grew 23 percent to P3.6 billion from P2.9 billion in the same period.