Maharlika fund eyes 3rd investment with foreign-listed firm

The Maharlika Investment Corp. (MIC) is gearing up for its third investment which would involve a foreign-listed company with ties in the infrastructure sector, according to its top official.

“We’ve got one more [investment] that we’re going to be announcing soon. Quite a significant transaction as well because it involves a listed company. Not a Philippine-listed company, but a foreign-listed company,” MIC President and Chief Executive Officer Rafael D. Consing, Jr. said in an interview on The Big Story on One News on Tuesday.

Mr. Consing said that the investment could be an “infrastructure play,” but clarified it will not be involved in transportation.

Over the weekend, the MIC announced an agreement to establish a private equity fund aimed at raising up to USD 1 billion with Thailand’s Charoen Pokphand Group Co., Ltd. (CP Group).

“What we aim to do is to invest in modernization of agricultural production, modes of agricultural production, similarly expanding and accelerating digital transformation for these companies that we will be acquiring, and then third would be doing sustainable energy,” Mr. Consing said.

He said the investments with the CP Group will be all domestic.

“We are going to be steering this national development fund during its nascent stage,” he added.

Mr. Consing said the sovereign wealth fund is designed as a “collaborative vehicle of the government to be able to attract foreign direct investments.”

MIC has previously mentioned its interest in investing in energy, food security, healthcare, and resource development, particularly mining. However, the tobacco and weapons sectors are off-limits for the MIC.

Asked why it hasn’t invested in other Philippine listed firms; he said the MIC is acting like a private equity fund.

“We do get ourselves exposed to the public markets, provided it’s part of an overall M&A (mergers and acquisitions) transaction… We’ve got a twin mandate, that being able to have social impact and at the same time (generate) profits. And you don’t generate social impact when you invest in the stock market.”

However, Mr. Consing said the MIC is not closing its doors on listed firms and will be open provided this would be part of “an overall M&A deal.”

On Jan. 27, the MIC signed a deal to acquire a 20% stake in the listed Synergy Grid & Development Phils., Inc. to gain a “foothold” in the National Grid Corp. of the Philippines, the sole operator of the country’s power grid.

It marked the MIC’s first investment since President Ferdinand R. Marcos, Jr. signed the law creating the country’s first sovereign wealth fund in July 2023.

Asked about MIC’s targeted returns, Mr. Consing said: “We’re aiming, obviously, to generate significant spread above the existing benchmarks that are out there, and those benchmarks are the 10-year or the 20-year ROP (Republic of the Philippines) bonds. But those are quite confidential.”

Mr. Consing said the MIC has also set up a single investment limit at 20% of its seed capital, as well as sectoral limits.

“And there’s an extra 10% of tactical capital that we can allocate,” he added. — Aubrey Rose A. Inosante