Cirtek to offer preferred shares
Laguna-based electronics manufacturer Cirtek Holdings Philippines Corp., which recently established its foothold in Silicon Valley with the acquisition of antenna solutions provider Quintel, plans to offer preferred shares to investors as part of a P2-billion capital build-up program.
The company’s board of directors has approved the implementation of the initial increase of P300 million in Cirtek’s capital from P560 million to P860 million through the issuance of preferred A shares to Camerton Inc. at a par value of 10 centavos each. This is a partial execution of the authorized increase in capital base to P2 billion.
Separately, Camerton, the corporate vehicle of the Liu family, the majority shareholder of Cirtek, will also subscribe to 70 million preferred B shares at a par value of P1 per share.
Also, Cirtek has earmarked 200 million in new preferred shares to be offered to investors at a price to be approved by the board in the future.
Cirtek is authorized to issue up to P1.4 billion in common shares at a par value of P1 each and up to P600 million in preferred shares classified into P140 million worth of preferred shares divided into 1.4 billion shares with a par value of 10 centavos each and P460 million new preferred shares with a par value of P1 per share.
The issuance of preferred shares to Camerton is meant to prevent the dilution of interest given that Cirtek is set to issue new preferred shares through a follow-on offering. This is seen to ensure that the Liu family will maintain majority control of Cirtek.
Cirtek has moved up the electronics manufacturing value chain with the acquisition of US-based Quintel for $77 million. With the consolidation of Quintel into Cirtek’s books in the last five months of this year, the deal is seen to add $20 million in revenue this year and more than $100 million in 2018.
Cirtek is also pumping in $30 million in additional working capital to boost Quintel’s capacity.
While already strong in the US with a market share of 15 percent, Quintel will break into Latin America with Puerto Rico as its gateway. The existing marketing office in the UK will also be used as a jumping board to promote and market products to Europe. —DORIS DUMLAO-ABADILLA
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