MANILA, Philippines—The local gaming unit of Macau’s Melco Crown group has obtained approval from the Securities and Exchange Commission to jack up its authorized capital stock ahead of a $400-million fresh equity offering plan.
In a disclosure to the Philippine Stock Exchange on Wednesday, Melco Crown (Philippines) Resorts Corp. said the SEC approved amendments to the company’s authorized capital so as to increase authorized capital to 5.9-billion shares from 900 million at present.
With a par value of P1 per share, this represents an increase in authorized capital stock to P5.9 billion from P900 million at present. But based on current market prices, the five-billion increase in common shares is valued at P72.5 billion.
Melco’s share price rose by about 3.9 percent to close at P14.50 per share on Wednesday.
Out of the increase in authorized capital stock, Melco Crown will issue about 2.85 billion common shares to the Melco group’s holding firm MCE Investments at P1 per share of a total subscription of P2.85 billion. Also, earlier approved by the company’s board was the purchase of 147.89 million common shares in MCE Holdings (Philippines) Corp. for a total consideration of about P7.2 billion.
Melco earlier announced plans to raise up to $400 million from a follow-on equity offering. The proceeds are expected to fund part of the Melco group’s investment in the second entertainment complex that will rise along Pagcor City along Manila Bay, the country’s future version of the Las Vegas and Macau gaming hubs.
Melco Crown has ventured into the Philippine gaming industry through a partnership with the SM group, which is building the $1-billion Belle Grande entertainment complex, the second gaming complex to rise in Pagcor City after the recently opened Solaire Manila of tycoon Enrique Razon.