Maharlika weighs IPO investments

MAHARLIKA Investment Corp. (MIC), manager of the country’s sovereign wealth fund, is assessing possible investments in companies preparing to go public, although initial public offerings (IPOs) are not its immediate priority.

“We’ve looked at some IPOs. [It’s] a bit difficult because management teams are busy talking to all investors, so it’s hard for us to get the level of diligence we need before investing,” MIC Vice-President for Investments Kheed Ng told reporters on Tuesday.

“If I just buy stocks in the public markets, what impact do I make? If it’s primary capital to support a new facility or new road, then maybe we can consider it, even if it’s a public offering,” he added.

The Philippine stock market recorded only two IPOs this year: the P732.6-million listing of Cebu-based Top Line Business Development Corp. in April and the P34.3-billion debut of Maynilad Water Services, Inc. in November. These fell short of the Philippine Stock Exchange’s target of six IPOs for 2024.

China Bank Capital Corp. Managing Director Juan Paolo E. Colet said MIC’s possible participation in IPOs could help energize the local market.

“Given its limited capital, Maharlika should explore ways to magnify its impact,” he said, adding that MIC could invite other sovereign wealth funds and foreign institutions to co-invest in a separate, MIC-managed vehicle targeting “socioeconomically impactful IPOs and other equity transactions.”

He stressed the importance of strict selection criteria, including long-term prospects, good governance, and alignment with national development priorities.

MIC, created under Republic Act No. 11954, is tasked with managing the Maharlika Investment Fund and establishing its governance frameworks.

One of MIC’s latest initiatives is a partnership with the National Electrification Administration (NEA), the provincial government of Palawan, and Palawan Electric Cooperative, Inc. (Paleco) to help improve the province’s power distribution network.

The parties recently signed a memorandum of agreement to share technical expertise and pursue modernization of Palawan’s aging electrical infrastructure.

“Often hailed as the jewel of the Philippines, Palawan’s booming tourism has boosted both the local economy and our country’s global image. However, the island’s aged infrastructure has struggled to keep up,” NEA Administrator Antonio Mariano C. Almeda said during the signing.

Under the agreement, MIC will assess Paleco’s infrastructure and recommend cost-efficient upgrades, with potential investments depending on the results of the study. NEA will oversee technical requirements and implementation, while the provincial government will facilitate coordination and regulatory processes.

“We are here to diagnose the grid’s ailments with precision so that Maharlika can finance the modernization required to cure them,” MIC Chief Legal Officer Paul T. Salanga said.

MIC has previously invested in Synergy Grid & Development Philippines, Inc., a shareholder of the country’s sole grid operator, and Makilala Mining Co., Inc., a mineral exploration firm.

In its 2024 annual report, the fund said it is prioritizing projects in energy transition and security, physical infrastructure and innovation, food and agriculture, social infrastructure, sustainable resource development, and climate adaptation.

“We’ve got a pipeline that I think is quite robust,” Mr. Ng said. “In the next six months, you can expect some deals that the public will be quite happy with.” — Sheldeen Joy Talavera