(Bloomberg) -- Philippine conglomerates Metro Pacific Investments Corp. and San Miguel Corp. have started talks to explore combining their toll road businesses, which people familiar with the matter said would form a group worth as much as $10 billion, making it the country’s biggest-ever merger.

If a deal is reached, it could also lead to the merged entity being listed on the stock exchange in Manila, the people said, asking not to be identified as the talks are private. The companies are also exploring other possible business combinations, including of their power and energy divisions, the people said.

Considerations are preliminary and Metro Pacific and San Miguel may decide against pursuing a merger of their assets, the people said. 

San Miguel issued a statement Tuesday saying it is in talks with Metro Pacific on a possible joint venture for the toll road businesses. 

A representative for San Miguel didn’t respond to requests for comment on the value of a potential deal. Metro Pacific declined to comment. 

A $10 billion merger of the toll road operations would eclipse SM Prime Holdings Inc.’s $7.3 billion acquisition of SM Land Inc. in 2013, according to data compiled by Bloomberg. 

Metro Pacific Chairman Manuel Pangilinan said last year that his friendship with San Miguel’s President Ramon Ang could help lead to a merger of the toll road ventures, and that a subsequent listing could “energize” the local stock exchange, Bloomberg News reported. 

“The stock exchange needs significant companies to be listed, and I think this will be significant,” Pangilinan reiterated last week.

Metro Pacific, backed by Hong Kong-based First Pacific Co. Ltd., operates 223 kilometers (139 miles) of expressway across three major Philippine toll road systems, and will add a further 72 kms in the next 5 years, according to its website. The company also has interests in power, water, health care, light rail and logistics, the website shows.

Metro Pacific reported net income of about 16 billion pesos ($285 million) in the first nine months of last year, with its toll road operations accounting for 4.1 billion pesos. 

Read More: San Miguel Says Construction of Expressway Projects to Start 4Q

Through its SMC Infrastructure unit, which posted operating income of 13.7 billion pesos for the first nine months of 2023, San Miguel manages the construction, management and operation of projects such as the Tarlac-Pangasinan-La Union Expressway, the Southern Tagalog Arterial Road and the South Luzon Expressway, according to its website. 

San Miguel is also involved in the food and beverage industry, oil refining and marketing, cement, packaging, real estate, as well as power and energy.

--With assistance from Cliff Venzon and Ditas Lopez.

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