Manila's San Miguel in talks to buy into rail project

MANILA, March 4 (Reuters) - Philippine food-to-power conglomerate San Miguel Corp (SMC.PS) SMCB.PS said on Thursday it was in discussions to acquire a majority interest in a major mass railway transit project in Manila.

The project, known as Metro Rail Transit-Line 7 (MRT-7), will be built by the Universal MRT Corp consortium and will link the capital to the northern province of Bulacan.

"We confirm that the company has been offered a majority stake in the MRT-7 project. The company is negotiating with the members of the consortium of the project," San Miguel said in a statement to the stock exchange.

It said it has started due diligence audit of MRT-7.

The firm did not provide more details on the project but local newspapers said MRT-7 was estimated to cost $1.5 billion. The project involves the construction of a 22-km light rail transit system carrying at least half a million passengers a day.

San Miguel has been expanding away from its core food and beverage business and into heavy industry such as power, infrastructure and telecommunications to fuel faster future growth.

It said in the same statement that it was in the final phase of talks to acquire a 67 percent stake in Ausphil Tollways Corporation, which is building an expressway project covering over 480 kilometres from Manila to as far as Tuguegarao City in northern Cagayan province. [ID:nSGE62206E]

San Miguel's A shares restricted to local investors fell 1.4 percent and its B shares slipped 0.7 percent on Thursday, narrower falls than the 1.15 percent slide in the main stock index .PSI. ($1 = 46.09 pesos) (Reporting by Monicca Egoy)