Metro Pacific gets new shares in infra unit
MANILA, Philippines—A local affiliate of the Metro Pacific group is exercising its option to acquire new shares in infrastructure holding firm Metro Pacific Investments Corp.
This is in exchange for P6.6 billion worth of convertible bonds issued a year ago when the group was raising fresh funds to raise interest in power distribution firm Manila Electric Co.
This conversion will result in the issuance of 2.03 billion new common shares to MPIC affiliate Metro Pacific Holdings Inc., in turn diluting existing shareholders by about 10 percent.
Based on the disclosure, both parties agreed that these conversion shares will be issued by MPIC out of an increase in authorized capital stock.
But if the increase in authorized capital is not completed within 30 days from conversion date, MPHI has the option to require MPIC to issue the conversion shares out of its current unissued capital, the disclosure said.
Shares of MPIC fell by 4.11 percent to P3.73 each after the conversion notice was disclosed.
But some analysts said this may not necessarily be due to the pending dilution, which had long been known to the market.
“I think it’s more technical in nature. There was really an overhang (from the conversion) but this has been factored in,” said Jose Mari Lacson, head of research at local brokerage Campos Lanuza & Co.
During the last briefing for analysts, Lacson said the group of Manuel V. Pangilinan (MPIC chair) had said the conversion would indeed take place this April.
“Although Metro Pacific Holdings is in the money, I don’t think they will sell off right away because share prices are just recovering,” Lacson said.
MPIC issued the convertible bonds to MPHI in March 2010 when it created jointly with what was then Pilipino Telephone Corp. the holding firm Beacon Electric Asset Holdings Inc. where shares in Meralco were consolidated.
It was also during this time when the Pangilinan-led group bought additional shares in Meralco from the Lopez family.
