The construction of the Makati Subway brings joy to everyone who commutes here in the Philippines as the current traffic situation in the major places in Manila worsens. Our fellow Filipinos believe that this subway will improve the experience of commuters in a way that commute will become faster and easier during rush hour. That’s possible, yes, but we will only know it once the subway becomes available for use. Now, what we have as an update is that it is going to be linked up with the planned Skytrain of Megaworld.
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Makati Subway, of which the construction will start this year, will be connected to the proposed monorail being constructed from Guadalupe MRT Line 3 Station to the township owned by Megaworld in Taguig City. We all know that the subsidiary of Philippine Infradev Holdings, Inc.—Makati City Subway Inc. (MCSI) is building the Makati Subway. As per the subsidiary’s disclosure, it is currently creating a joint venture with Megawold for a common station with the Skytrain. The Skytrain is actually being developed by another company led by Andrew Tan. MCSI has already received the term sheet from Megaworld for the said joint venture. Exciting news is coming for both of these companies!
The joint venture that will be built by Megaworld and MCSI will connect the $3.5-billion Makati Subway and P3.5-billion Skytrain project of Infracorp Development, Inc. Infracorp is the Alliance Global Group, Inc.’s infrastructure arm. Alliance is the parent of Megaworld. You might be confused by the names of the company involved but as you invest in stocks and other portfolios, you will know how subsidiaries and parents work here in the Philippine and which is which. Basically, the joint venture will be in charge of the linking of the two transportation systems. It was also disclosed that the common station will also be linked to Guadalupe MRT station and the Pasig River ferry system.
Let’s take a look at what the term sheet says about the agreement. According to the document, MCSI and Megawold have 60 days finalize definitive agreements covering the proposed joint venture including the Joint Venture Agreement and the Articles of Incorporation. Within the same period, MSCI will not venture into any other agreement or any transaction that will involve the land to be utilized as the common station. Those are the disclosures for now. The information is pretty straightforward. I will update you again as soon as the agreement becomes final.