Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The proposed spin-off - from 49.9%-held MPIC - and listing of <a href="https://www.smartkarma.com/entities/maynilad-water-services-inc" target="_blank" data-smartkarma-citation="entities:44852:1" rel="noopener">Maynilad Water Services (MYNLD PH)</a> completed on the 7th November. </li>
<li>Priced at PHP 15/share, Maynilad closed yesterday at PHP 14.82/share, down 1.2%. </li>
<li>
<a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a>'s indirect/direct holding in Maynilad is estimated at 19.1%, accounting for ~6% of NAV. </li>
</ul>


The proposed spin-off - from 49.9%-held MPIC - and listing of Maynilad Water Services (MYNLD PH) completed on the 7th November. 
Priced at PHP 15/share, Maynilad closed yesterday at PHP 14.82/share, down 1.2%. 

First Pacific Co (142 HK)'s indirect/direct holding in Maynilad is estimated at 19.1%, accounting for ~6% of NAV. 


First Pacific (142 HK)'s Full Value As Maynilad Commences Trading

<ul>
<li>In <a href="https://skr.ma/wK6xN" target="_blank" rel="noopener">First Pacific (142 HK): Maynilad's IPO Price Firmed</a>, I discussed Maynilad's upcoming IPO, a company controlled by MPIC, which in turn, is controlled by <a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a>.</li>
<li>Since that note, I have tracked down Maynilad's elusive prospectus.</li>
<li>This insight is largely a rehash of yesterday's note, together with updated numbers applying prospectus figures. I thought this warranted a fresh insight as opposed to a boomerang.</li>
</ul>


In First Pacific (142 HK): Maynilad's IPO Price Firmed, I discussed Maynilad's upcoming IPO, a company controlled by MPIC, which in turn, is controlled by First Pacific Co (142 HK).
Since that note, I have tracked down Maynilad's elusive prospectus.
This insight is largely a rehash of yesterday's note, together with updated numbers applying prospectus figures. I thought this warranted a fresh insight as opposed to a boomerang.


First Pacific (142 HK): Maynilad's IPO (Now With Prospectus Numbers)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a>'s 49.9%-held MPIC is spinning off Maynilad, a distributor of potable water and provider of sewage services, on the Philippine exchange.</li>
<li>The IPO has been priced at PHP 15/share, down 25% from earlier expectations. Proceeds may reach PHP 34bn (~US$580mn), in the largest Filipino IPO since 2021. </li>
<li>First Pac's NAV discount has drifted off a recent multi-year narrowing, but remains elevated for a multiple cross-border, difficult to short holdco.</li>
</ul>



First Pacific Co (142 HK)'s 49.9%-held MPIC is spinning off Maynilad, a distributor of potable water and provider of sewage services, on the Philippine exchange.
The IPO has been priced at PHP 15/share, down 25% from earlier expectations. Proceeds may reach PHP 34bn (~US$580mn), in the largest Filipino IPO since 2021. 
First Pac's NAV discount has drifted off a recent multi-year narrowing, but remains elevated for a multiple cross-border, difficult to short holdco.


First Pacific (142 HK): Maynilad's IPO Price Firmed

<ul>
<li>In <a href="https://skr.ma/EZx9j" target="_blank" rel="noopener">StubWorld: First Pacific (142 HK) Looking Stretched</a>, I saw <a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a>'s discount to NAV at ~30%, around its narrowest level in a decade.</li>
<li>That analysis applied a fixed value for MPIC (delisted in 4Q23). However, if applying a look-through into 23.7%-held <a href="https://www.smartkarma.com/entities/manila-electric-company" target="_blank" data-smartkarma-citation="entities:3527:1" rel="noopener">Manila Electric Company (MER PM)</a>, that NAV discount widens. Currently ~40%.</li>
<li>By that yardstick this is the narrowest NAV discount since early 2018. This appears too tight. The benefits from the proposed spin-off of Maynilad appear baked in.</li>
</ul>


In StubWorld: First Pacific (142 HK) Looking Stretched, I saw First Pacific Co (142 HK)'s discount to NAV at ~30%, around its narrowest level in a decade.
That analysis applied a fixed value for MPIC (delisted in 4Q23). However, if applying a look-through into 23.7%-held Manila Electric Company (MER PM), that NAV discount widens. Currently ~40%.
By that yardstick this is the narrowest NAV discount since early 2018. This appears too tight. The benefits from the proposed spin-off of Maynilad appear baked in.


First Pacific (142 HK) Is Fully Valued Here

<ul>
<li>Via 49.9%-held MPIC, <a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a> is spinning off Maynilad, a provider of water and wastewater services in the Greater Manila Area, on the Philippine Stock Exchange</li>
<li>Maynilad will tentatively have a market cap of US$2.7bn. Other key investors include <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> and <a href="https://www.smartkarma.com/entities/marubeni-corp" target="_blank" data-smartkarma-citation="entities:7463:1" rel="noopener">Marubeni Corp (8002 JP)</a>. Listing is expected in July.</li>
<li>I see First Pac's discount to NAV at ~30%, around its narrowest level in a decade. </li>
</ul>


Via 49.9%-held MPIC, First Pacific Co (142 HK) is spinning off Maynilad, a provider of water and wastewater services in the Greater Manila Area, on the Philippine Stock Exchange
Maynilad will tentatively have a market cap of US$2.7bn. Other key investors include DMCI Holdings (DMC PM) and Marubeni Corp (8002 JP). Listing is expected in July.
I see First Pac's discount to NAV at ~30%, around its narrowest level in a decade. 


StubWorld: First Pacific (142 HK) Looking Stretched

Philippines

Philex Mining Corporation produces copper concentrates, containing copper, gold, and silver. The Company was incorporated in 1955.

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Philex Mining (PX PM)

First Pacific (142 HK)'s Full Value As Maynilad Commences Trading

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First Pacific (142 HK): Maynilad's IPO (Now With Prospectus Numbers)

This insight is largely a rehash of yesterday's note, together with updated numbers applying prospectus figures. I thought this warranted a fresh...

David Blennerhassett

First Pacific (142 HK): Maynilad's IPO Price Firmed

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First Pacific (142 HK) Is Fully Valued Here

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StubWorld: First Pacific (142 HK) Looking Stretched

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David Blennerhassett

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