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Filinvest to issue new shares

Posted on July 25, 2011 11:10:00 PM [ BusinessWorld Online ]

HOLDING FIRM Filinvest Development Corp. will sell almost P250 million worth of new shares to its majority stockholder at the end of the month, reviving its postponed plans to raise its public float by offloading such shares on the local bourse.
“The corporation entered into a subscription agreement with ALG Holdings Corp. covering the issuance of 49.8 million Filinvest Development common shares…out of the unissued capital stock,” the company told the local bourse yesterday, referring to its key stockholder.

ALG Holdings, which is also controlled by the Gotianun family, owned 6.86 billion common shares or a 91.32% stake in the listed holding firm as of end-June.

The new shares will be sold at P5 apiece for a total purchase price of P249 million payable on or before July 26, the firm added.

An official said the recent development is in line with the company’s earlier plans to sell shares.

“That is related [to the postponed follow-on offering] in a sense but it is not too big,” Annabelle D. Arceo, investor relations chief of the company, said in Filipino in a telephone interview yesterday.

In January, Filinvest Development postponed its follow-on offering involving the sale of as much as 2.88 billion shares to an indefinite date.

Under the plan, ALG Holdings was to buy the new Filinvest Development shares and unload the same number of stocks to the public.

“Maybe we will do it in tranches. At the time the [fund raising] was called off early this year, the market was in bad condition,” Ms. Arceo added.

The Philippine Stock Exchange index, a basket of 30 stocks regarded as the benchmark of the market’s overall performance, declined by 3.47% or 146 points to 4,201.14 as of March 31 from Dec. 31, 2010.

Asked if the company will increase public float this year, Ms. Arceo said: “We will try to comply by that time.”

“Our best effort is to comply,” Ms. Arceo said.

On Nov. 30, the PSE started implementing the 10% minimum public ownership rule. Companies were given a 12-month grace period before the imposition of penalties, which include delisting from the bourse.

To date, the holding firm only has a 7.7% public ownership level.

Shares in the company, whose profits jumped by 26% to P2.38 billion in the first half, closed 1% lower at P4.95 each yesterday. -- Neil Jerome C. Morales

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