GT Capital wants to jack up interest in Metro Pacific infra unit

By: DORIS DUMLAO-ABADILLA
Philippine Daily Inquirer
05:16 AM May 22, 2017
http://business.inquirer.net/229991/gt-capital-wants-jack-interest-metro-pacific-infra-unit

In an interview with Inquirer after the company’s investor briefing recently, GT Capital chief finance officer Francisco Suarez said that after raising the holding firm’s interest in Metropolitan Bank and Trust Co. and infusing fresh equity into Toyota Financial Services, there would likely be no more acquisitions involving other Ty group member firms.

He said GT Capital was on the lookout for new businesses, such as in infrastructure, logistics and retail-oriented commercial property or shopping malls.

“Within the group we are already in a steady state. We’re looking at (opportunities) outside,” Suarez said.

In the case of infrastructure holding firm Metro Pacific Investments Corp., where the group held a 15.55-percent interest, Suarez said GT Capital remained “opportunistic.” “So if there’s an opportunity to further grow our direct stake, at the right price, of course (we’ll take it),” he said.

As a strategy, Suarez said GT Capital was growing based on “concentric” circles, referring to several circles with the same centerpoint. The first circle is organic growth—expansion and modernization of different companies under the group while the second circle is extracting synergy by cross-selling across different groups.

“The third circle is new business, like when we invested in Metro Pacific. It’s an entirely new business not within the group,” Suarez said.

Asked what new businesses the group would like to pursue, Suarez said GT Capital was keen on logistics and retail commercial. Investments in logistics, he said, would likely be through Metro Pacific. If Metro Pacific is able to close the deal to acquire Air21 from the Lina group, for instance, Suarez said this would be a big acquisition.

On retail commercial development, Suarez said it was important to build recurring income. While property arm Federal Land can build its own leasing portfolio, Suarez said this was still a very small business at present.

“It’s possible to acquire. It could be through Federal Land, or through Pro-friends (Property Company of Friends Inc.),” he said. With a landbank of 1,600 hectares, Suarez said one option would be to carve out a portion of the property and devote this to retail commercial development.

He said GT Capital could also pursue infrastructure projects outside Metro Pacific. In the past, Suarez said the group had looked at investing in a port. Had such project prospered, Suarez said it would have catered to Toyota Motor’s pre-inspection requirements.

At present, he said the vehicles imported by Toyota were taken from the port to the Sta. Rosa facility. If GT Capital had its own port, he said the imported vehicles could be brought straight from the port to the dealer.

GT Capital sees capital spending this year, reaching P47 billion.