Alliance Global sets P150B expansion for next 2 yrs

ALLIANCE Global Group Inc. (AGI), the conglomerate of businessman Andrew Tan, will be spending P150 billion in 2016 and 2017 to fund its expansion plans.

At a press briefing after the company’s annual stockholders meeting on Thursday, AGI president Kingson Sian said bulk or “close to P100 billion” of the capital expenditure will go to its property vehicle Megaworld Corp to fund the development of malls, commercial centers, office buildings and residential towers, and land acquisition.

“We continue to be optimistic about what lies ahead. That is why we have kept an aggressive capex plan moving forward. In 2010 to 2015, we spent an aggregate of P270 billion for our expansion projects. We will spend more than half of that amount for 2016 and 2017 alone, proving our positive outlook for our business,” Sian said.

The next biggest capex allotment will be for AGI’s resorts and casino operator unit Travellers International Hotel Group Inc., followed by its quick service restaurant business through Green Arches Development Corp. (GADC), and its liquor business Emperador Inc.

The spending program will be financed by borrowings and internally generated funds, Sian said, adding that the group will focus on property and tourism developments in line with the government’s thrust to improve the country’s infrastructure and tourism.

AGI aims to deliver 12,000 hotel rooms by 2020, four times the current number. This will be through additional hotel offerings of both Travellers and Megaworld unit Global-Estate Resorts Inc. (GERI).

Megaworld is setting aside 75 percent of its P55 billion capex in 2016 for more property developments while 25 percent will go to land acquisition and investment initiatives.

“We still have a lot. Actually even if we don’t acquire [properties]for the next 15 to 20 years, we can still do good with developing our existing 4,000 hectares of land bank,” Sian said, citing Megaworld’s focus on developing integrated townships and tourism hubs.

Megaworld has 21 integrated urban townships located in 12 sites across the country. Travellers has ongoing expansion developments in Resorts World Manila and is in the master planning stage for Westside City, another resorts and casino hub set to rise in Entertainment City after Solaire Resorts & Casino, City of Dreams Manila, and Okada Manila.

For Emperador, AGI will continue its Philippine and Spain operations following the acquisition of Whyte & Mackay and Fundador, making Emperador an international liquor company and the largest brandy maker in the world.

In its quick service restaurant business, GADC, the franchise holder of McDonald’s in the Philippines, has committed to increase its McDonald’s outlets to 900 stores by end-2020. The company expects to hit its goal of
500 stores by the end of the year.

Other potential growth areas where the group is scouting for opportunities include public-private partnership (PPP) projects, the real estate investment trust (REIT) space, and tourism destination developments.

“Our continued investments have given our group a competitive edge that is difficult to match. With all the pieces already in place, we believe that we have set the stage for a strong long-term growth,” Sian said.

AGI is the listed umbrella conglomerate of tycoon Andrew Tan, which holds his businesses in property development (Megaworld); spirits and brandy manufacture (Emperador); quick-service restaurants via McDonald’s franchise (GADC); and integrated tourism development businesses (Travellers).

Source: http://www.manilatimes.net/alliance-global-sets-p150b-expansion-for-next-2-yrs/288662/

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