METRO Pacific Investments Corp. (MPIC) is looking to pivot to less-regulated industries such as food and logistics, its chairman said, pointing to the need to balance the firm’s risk portfolio.
“We started in food and agriculture, that’s one part of it. We’re looking at the possibility of logistics as a major investment area for us,” MPIC Chairman Manuel V. Pangilinan said in an interview with Cathy Yang for Thought Leaders.
The MPIC group entered the logistics business through MetroPac Movers, Inc., which started operations in May 2016.
“We did try once and we failed. So, this time we’ll try to be more careful about the effort for the logistics. That’s less regulated than what we have now,” Mr. Pangilinan said.
The pivot to the two industries is seen to improve the risk portfolio of MPIC, whose businesses are in power, water, tollways, and light rail, among others.
“It’s just the question of balancing the risk portfolio as we see it, because part of the criticism leveled against MPIC, which affected its share price, is the regulatory capture,” he said, pointing out that its existing businesses are regulated.
“The hospitals are not that much regulated. I think that’s the only exception in our portfolio now. So, we have to review and balance it a bit more because it will flow through MPIC itself and to First Pacific,” he said, referring to First Pacific Co. Ltd.
MPIC is one of three key Philippine units of First Pacific, a Hong Kong-based investment management and holding company.
The pivot also aims to provide the basic needs of Filipinos, especially in light of the current situation on food supply.
“Food is an area where the country needs help and I think it is sad that we need to import increasing food items. We’re even looking at aquaculture now. And the logistics — the logistics cost in the country is too expensive,” Mr. Pangilinan said.
Mr. Pangilinan said MPIC is not seeing the real estate business as a core driver, following its full acquisition of Landco Pacific Corp. in 2022.
“Landco is a very focused real estate business,” he said, adding that the company is not going to compete with other real estate companies’ horizontal or vertical developments.
“We are not into that because that requires a lot of money. That will drive us away from the core businesses that we want to develop,” he said.
“But I think there is a niche market for Landco in terms of the resort, tourist-driven — whether domestic or foreign — resort-type developments. They have been quite successful at it and I think for the first time in so many years we are profitable in 2021 and 2022, and more profitable in 2023 in that niche market,” he added.
Mr. Pangilinan said that he doesn’t want to compete against conglomerates, which usually have banking and real estate in their portfolio.
“The less we butt heads with them, I think, the better,” he said.
MPIC’s units include Manila Electric Co., Maynilad Water Services Inc., MetroPac Water Investments Corp., Metro Pacific Tollways Corp., Metro Pacific Hospital Holdings Inc., and Light Rail Manila Corp.
Aside from MPIC, First Pacific’s Philippine units are Philex Mining Corp. and PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.
On Wednesday, MPIC shares declined nine centavos or 2.03% to P4.35 each. — Justine Irish D. Tabile