March 31, 2015

Another round of arbitration for Maynilad

In separate disclosure released today, Metro Pacific Investments Corp (MPI) and DMCI Holdings Inc (DMC) announced that Maynilad Water Services Inc (Maynilad) has served the government a Notice of Arbitration and Statement of Claim following the latter’s failure/refusal to respond to Maynilad’s demand for compensation in relation to Maynilad’s arbitration case with the Metropolitan Waterworks and Sewerage System (MWSS).

To recall, Maynilad issued last 20 Feb a demand latter to the government, seeking claims for compensation for revenue losses due to MWSS’ refusal to implement Maynilad’s rate rebasing adjustment, despite the final award issued by arbitration panel in favor of Maynilad (23 Feb, Daily Wealth Take).

According to Maynilad, total revenues losses from 1 Jan 2013 to 28 Feb 2015 have already reached P3.44b, and it continues to incur revenues losses averaging P208m for every month of additional delay in 2015.

A second demand letter was sent to the government last 9 Mar but the government had yet to respond, thus prompting Maynilad to raise the issue to arbitration. The arbitration proceedings shall be conducted in Singapore before a three-man panel. Maynilad is 52.8% and 25.2% owned by MPI and DMC, respectively. - WealthSec