MANILA - Philippine utility Maynilad Water Services Inc has signed a revised water deal with the government to allow it to continue operating, more than a year after President Rodrigo Duterte threatened to take over its business.
Maynilad has agreed not to raise water rates before the end of 2022 and forgo some revenue, among a series of new conditions approved by the regulator, according to disclosures issued by its shareholders.
Maynilad and the regulator signed a revised water contract on May 18, allowing it to run the water distribution business until 2037, DMCI Holdings Inc and Metro Pacific Investments Corp MPI.PS said in separate disclosures.
The utility will forgo a 3.4 billion pesos ($71 million) award it won in an arbitration case against the government, its shareholders said.
Maynilad and fellow concession holder, Manila Water Co Inc, which together serve 16.8 million customers in the capital, had faced criticism from Duterte. The president said their contracts were "onerous and disadvantageous" to the public and threatened to strip them of their concessions.
"All provisions previously deemed disadvantageous to the government and to the consumers have been removed," Justice Secretary Menardo Guevarra told Reuters.
In March, Manila Water, partly owned by Ayala Corp, also signed a revised concession deal with the government whereby it also agreed not to increase fees.
Duterte last year apologised for hurling "hurtful words" against the billionaire owners of the water utilities after they had helped the government respond to the coronavirus pandemic.
While the firebrand leader's tirades against tycoons have often been popular with the public, they have at times stirred investor worries over abrupt policy changes under his administration. ($1 = 47.8390 Philippine pesos)
(Reporting by Neil Jerome Morales Editing by Ed Davies) ((firstname.lastname@example.org; +632 8841 8914;))