Lopez Holdings subscribes to PDRs of unlisted Lopez Inc.
MANILA, Philippines—Listed Lopez Holdings Corp., the media and power holding arm of the Lopez clan, has subscribed to the Philippine Deposit Receipts of unlisted parent Lopez Inc., a Philippine Stock Exchange filing on Monday showed.
The transaction will grant Lopez Holdings rights to about 446.23 million common shares of broadcast unit ABS-CBN Corp.
The move will allow Lopez Holdings to continue to comply with foreign ownership laws relating to its roughly 60 percent economic interest in ABS-CBN.
Because foreigners are not allowed any ownership in media companies, and therefore banned from investing in Lopez Holdings, the company (then known as Benpres Corp.) and Lopez Inc. in 1998 structured an agreement involving the issuance of convertible debt that gave the listed holding firm an “economic interest” in ABS-CBN.
The notes expire in 15 years, or this Wednesday, hence the need for the present transaction, a company spokesperson said in an interview.
“In payment for the Lopez PDRs, Lopez Holdings Corp. assigned to Lopez Inc. its rights to the convertible note issued by Lopez Inc. in April 1998, which are convertible to the same ABS-CBN Corp. common shares,” Lopez Holdings said in the disclosure.
Apart from media, Lopez Holdings is also the parent firm of listed power generation firm First Philippine Holdings Corp. and Bayan Telecommunications Inc., currently under court-assisted rehabilitation.
At the end of 2012, Lopez Holdings held a 60.3 percent economic interest in ABS-CBN and 46.2 percent in First Philippine Holdings.
Lopez Holdings recently reported that net income last year rose 15 percent to P4.54 billion, including its share from the sale of an equity stake in Manila Electric Co. to the group of businessman Manuel V. Pangilinan.
