As San Jose del Monte, Bulacan, braces for a potentially stronger El Niño, the city’s worsening water crisis has exposed many structural and governance deficiencies in PrimeWater. Although its partnership with the water district has been officially terminated, the Villar Group company is still operating and collecting high taxes despite a service that has proven to be highly flawed.
The arrival of new Crystal Bridges owner Lucio Co. was meant to bring a new direction, but the lack of a well-defined renovation plan, capital commitment, or meaningful engagement with city leaders suggests a troubling lack of urgency. For an industry where executive accountability directly affects public welfare, the distinction between ownership change and bottom line action becomes harder and harder to justify.
The Lucio Co Group’s acquisition of PrimeWater Infrastructure Corp. at first it was interpreted as one of the traditional stories of the Philippine merger strategy: transfers in regulated services; a play for consolidating a fragmented sector, or long-term investment in stable, cash-flow driven infrastructure.
But the Vantage Point readers below — especially those from the San Jose del Monte, Bulacan area — have tipped us off to water problem that won’t go away. They generously provided us with a data-driven snapshot of what Lucio Co has truly achieved. Some 47,611 households – about 250,000 people, or about a third of the city’s population – live with poor or uncertain access to water.
There is a shortage of water service, and in-person lessons have been suspended by schools. A state of emergency has been declared by the city. And yet, amid this analysis, PrimeWater’s pricing system tells an alternative story. The company charges P265.63 for the first five cubic meters – half the base rate used by industry peers like Manila Water and Maynilad, which charge P210.43 and P247.24, respectively, for ten cubic meters. Customers are paying more for less – and often, for nothing.
This is not just a service problem. It is a structural imbalance where inefficiency is transferred to households with no other supplier. The city government, for its part, should be the official operator of last resort, spending P370 million annually, according to our consultants, for water truck transportation in 62 barangays.
Hospitals rely on these emergency supplies. In effect, public money is subsidizing the failure of a private corporation that continues to bill its consumers. In practice, the analysis becomes more illuminating upon closer inspection. Of the 122.36 million liters per day produced in San Jose del Monte, 47.16% is lost due to non-revenue water, leaks, theft, and system weaknesses that should have been mitigated by Lucio Co.’s capital investment and maintenance. About half of the treated water does not go to paying customers. This is no small indiscretion. It is a system that works in a way under minimum capacity.
PrimeWater still collects, the tap runs dry
The mutual agreement between PrimeWater and the San Jose del Monte Water District was was officially terminated in April 2025 due to three main factors: failure to reduce non-revenue water to the agreed 34%; the failure to present a committed capital expenditure plan of P2 billion – of which only 1 percent was reportedly used – and the continued deterioration of the quality of water service.
Typically, the termination of a partnership may indicate the loss of a business line. PrimeWater, however, continues to collect fees and take over infrastructure, which is not clearly within its contractual obligations. That’s where the acquisition of Crystal Bridges Holding Corp. meets the risk of governance.
On paper, PrimeWater has total assets of P42.37 billion, including P26.1 billion in service contract assets. However, a February 2026 Senate investigation revealed that Crystal Bridges had only P300,000 in capital. Even if there are organized financing systems, the gap between common capital and managed assets calls into question the depth of immediate financing, the transparency of financing, and the ability to carry out the major capital repairs that the system requires.
Under the threshold, an undisclosed acquisition price does not constitute a violation by itself. Unlike listed entities, private transactions are not subject to the same level of disclosure. But the biggest problem is not price transparency. It is a functional responsibility within a public-facing utility model.
PrimeWater’s business is tied up in partnerships with state-owned water districts, which are subject to audits, public scrutiny and regulatory oversight. The risks don’t end with shareholders, when there is a change of hands and no clear transition plan in place. It is shared through direct lines to consumers and local governments. San Jose del Monte is where the danger is most evident: a terminated contract that continues in practice; a non-renewable business license that doesn’t stop work, and a tax structure that continues to deliver value even when service is down. This is not just a gray area in governance. It is broken.
Poll on implementation
The market impact is immediate. The agreement was supposed to be a way to emphasize the concept that services are stable and protective assets. Instead, it creates the more ambiguous reality that infrastructure investment is only as strong as the governance systems behind the projects.
Investors are increasingly expected to distinguish more sharply between operators with strong performance histories and those dealing with unresolved operating liabilities hidden behind asset size.
In this situation, the way forward for Lucio Co seems clear, but also unforgiving. The only real strategic direction is a decisive switch from old practices to tangible, visible interventions. That means mutual commitments to invest in the repair of networks, strong reductions in non-revenue water, and a quick response to the harmonization of tariffs and service delivery. It also means dealing directly with local governments – not as parties to a contract, but as participants in a system that has already reached crisis point.
Most importantly, the action needed is to restore something that cannot be built through financial restructuring alone: trust. Water utilities do not operate on ambiguous balance sheets. They work in kitchens, hospitals, and schools. Customers will not evaluate the financial structure of the service provider or the debt of the organization. They care about the reliability, cleanliness, and affordability of their water service.
The PrimeWater acquisition was supposed to be about consolidation. It has become, instead, a referendum on implementation. Lucio Co has achieved scale, but it also inherited a system that was already problematic. The real question now is whether that level can be transformed into something more difficult to rebuild than infrastructure: trust. – Rappler.com
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