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Megaworld takes over resorts operator

By Jenniffer B. Austria | Jun. 21, 2014 at 12:01am [ ]

Megaworld Corp. said Friday it acquired a controlling stake in tourism estate developer Global Estate Resorts Inc. from parent Alliance Global Group Inc. in exchange for shares in casino operator Travellers International Hotel Group Inc.

Megaworld said in a statement it increased its stake in GERI to 80.4 percent from 25.76 percent, signaling the company’s venture into tourism sector.

Alliance Global Group Inc., the parent company of Megaworld, said it completed the sale of 5.405 billion common shares in GERI, which is equivalent to 49.2 percent, to Megaworld, for P10.43 billion.

Megaworld also acquired a 5.44-percent interest in GERI from minority shareholders during a tender offer.

Meanwhile, Alliance Global acquired Megaworld’s 1.125 billion common shares in Travellers International also for P10.43 billion.

Megaworld executive director Kingson Sian said Alliance Global acquired 1.125 billion shares in Travellers International at P9.27 per share, which was Traveller’s closing price on Thursday.

Prior to the transaction, Megaworld owned about 9-percent stake in Travellers.  With the sale, Megaworld’s stake in Travellers will drop to less than 3 percent.

“Megaworld’s acquisition of GERI signals our official entry to the country’s tourism industry,” Megaworld chairman and chief executive Andrew Tan said.

Sian in an interview at the sidelines of Megaworld’s annual stockholders meeting said GERI would remain listed with the Philippine Stock Exchange and would explore plans to tap the debt market to finance expansion projects.

Among the projects of GERI are the 1,149-hectare Twin Lakes in Tagaytay City, the 150-hectare Boracay Newcoast, the 561-hectare Southwoods City and the 170-hectare Sta. Barbara Heights in Iloilo.

The SobrepeƱa group will remain a minority shareholder in GERI with about 6-percent to 7-percent stake.

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