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AGI, Fil-Estate suspend deal a second time

Tuesday, 11 January 2011 00:00 [ manilatimes.net ]
ALLIANCE Global Group Inc.’s (AGI) acquisition of a controlling stake in Fil-Estate Land Inc. was put on hold for the second time. In separate disclosures to the Philippine Stock Exchange, AGI and Fil-Estate said they have agreed to move back the target date for the closing of their subscription transaction to Tuesday, “unless the parties agree to further postpone it.”
Both companies did not disclose the reason for the delay in the completion of the transaction.
The subscription of AGI to Fil-Estate’s shares is conditioned upon the occurrence of the following conditions: proof of the approval of the boards of directors of the property developer and Fil-Estate Management Inc. (FEMI) of the subscription agreement; the representations and warranties of Fil-Estate and FEMI contained in the agreement should be true and correct when made as of the closing date; and they should have secured an option for the early redemption of convertible bonds due in 2012 and for the pre-payment of loans.
Other stipulations include the execution of an escrow agreement for the escrow of the subscription proceeds prior to obtaining regulatory approvals; and the agreement should not have been terminated in accordance with its terms.
Last month, the two companies entered into a subscription agreement wherein AGI subscribed to P5-billion worth of Fil-Estate common shares, representing 59.88 percent of the property firm’s outstanding capital stock.
The subscription shares will be issued out of the pending P5-billion increase in authorized capital stock of Fil-Estate to 10 billion from the existing 5 billion shares, which its stockholders had approved on July 17, 2007.
AGI shares rose from P12.24 to P11.32 each, while Fil-Estate shares fell from P1.46 to P1.40 on Monday.
KRISTA ANGELA M. MONTEALEGRE
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