MANILA, Philippines – 8990 Holdings, Inc. (PSE:HOUSE) is eyeing to purchase a stake in Megawide Construction Corp. (PSE:MWIDE) given the acquirement could assist its attempt to commence a condominium development sector.
Januario Jesus B. Atencio III, 8990 Holdings President and Chief Executive Officer, stated in an interview dated December 9 that negotiations with Megawide regarding a probable acquisition of a part in the company has been taking place. He claimed that they are simply conversing about the matter, which is possible, and if potentially occurring, how much will the price be. This was revealed by HOUSE President when inquired regarding the currently happening talks about the acquisition.
Nonetheless, Megawide did not confirm or even deny the possible selloff of its stake to 8990 Holdings.
Anna Karenina M. Salgado, Megawide Corporate Communications Officer, responded to a question directed to Michael C. Cosiquien, Megawide Chairman and Chief Executive Officer. According to Salgado, 8990 Holdings is an existing client of the conglomerate. She also claimed that Megawide and 8990 Holding are maintaining communication relative to present projects.
Oliver Y. Tan, Megawide Chief Financial Officer, Chief Investment and Strategy Officer and Corporate Information Officer, revealed in an earlier interview that the company is planning to issue treasury shares, which are valued at 17 percent stake in a private placement prior to the end of 2016. The private placement proceeds are worth roughly P6 billion given its shares are exchanged more than P14 per piece. Last Friday, the stock price of Megawide finished at P14.54 on the Philippine Stock Exchange.
Megawide purchased back 410,842,702 shares from Sybase Equity Investment Corp. in late July. These would be represented by the treasury shares to be issued. Since 2011, the Sy family-owned investor and property development participant had been on the panel.
Though the negotiations between 8990 Holdings and Megawide are still maiden, Atencio stated that HOUSE has sufficient funds to carry out the acquirement. Last Friday, the mass homebuilder’s shares closed at P7.20 per piece.
Based on its unaudited financial statement as of September-end, 8990 Holdings has around P9.24 billion retained earnings, P353.5 million of cash on hand and in financial firms, and P10.75 billion of current assets.
Atencio stated that the acquirement would be pricey for both of the firms. However, the firms have a close relationship, and 8990 Holdings admires how Megawide works. He made EDSA Tower as an example. According to him, due to the early completion of the tower construction, which is advance by six months, they are now recognizing revenue from it. Supposedly, the realization of returns from the development would take place next year.
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