ESG Deal: Maynilad Water Services’ green IPO
IPO goes green
The Ps34bn (US$573m) IPO of the Philippines’ Maynilad Water Services offered investors in Asia a rare opportunity to invest in an ESG-related equity transaction.
The deal was the first Asian IPO to come with a “green equity” label. The label, launched by the Philippines’ Securities and Exchange Commission in 2025, is granted to a Philippine Stock Exchange listing by an issuer with more than 50% of revenues and investment earned from or directed towards environmentally sustainable activities.
Maynilad was keen to obtain a green equity label for the IPO given the nature of its business. The company is responsible for the waterworks system and sewerage and sanitation service in the western zone of Metro Manila and the province of Cavite under a 25-year government concession renewed in 2021.
The SEC came up with the framework for the green equity label in January and Maynilad’s decision to seek it for its IPO provided a catalyst for the regulator to finalise the regulations in September.
Ahead of obtaining the green equity label, the company also commissioned S&P for a climate transition assessment. S&P gave the company a “medium green” rating highlighting its low-carbon initiatives and said Maynilad was aligned with the Philippine green equity label.
The IPO, the country’s largest float since 2021, was launched at a time when the local stock market was weak, partly due to corruption claims against senior government officials related to infrastructure spending. Selling an IPO of this size was not easy given the low liquidity of the Philippine’s stock market.
However, the green equity label helped as it attracted cornerstone investors that were keen to invest in ESG plays. The biggest names were the Asian Development Bank and International Finance Corporation, which bought US$145m and US$100m respectively, their first cornerstone investments in a Philippine IPO.
Their participation gave momentum to the deal. In all, 12 cornerstone investors, including sustainability-focused fund managers such as Aberdeen, Robeco and Mobilist, investing a combined US$345m.
An attractive dividend yield of 6.6% for 2026 also drew investors, allowing the deal to price at the top of the Ps14–Ps15 per share range. The IPO price translates into a forecast 2026 EV/Ebitda multiple of 6.8, compared with Manila Water’s 6.2.
The deal was also the first Philippine IPO with an upsize option. The company launched the deal with a base size of 1.68bn shares and an upsize option of 354.7m shares which was fully exercised following strong demand, as was a greenshoe.
BPI Capital, HSBC, Morgan Stanley and UBS were joint global coordinators and underwriters. BDO Capital, First Metro Investment Corp, Security Bank Capital Investment Corp, East West Banking Corp and Maybank were the other underwriters.
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