Lopez Holdings invests P1.5B in parent’s PDRs

Lopez Holdings Corp. is investing P1.5 billion in Philippine depositary receipts (PDRs) to be issued by its privately held parent, holding firm Lopez Inc., in exchange for the option to acquire some of the latter’s stocks in broadcasting giant ABS-CBN Corp.

In a disclosure to the Philippine Stock Exchange on Monday, Lopez Holdings said it had entered into a memorandum of agreement with Lopez Inc. for the subscription to the latter’s PDRs.

Lopez Holdings has the option to exchange these PDRs into 34.7 million common shares in ABS-CBN.

The P1.5-billion investment in PDRs, the disclosure said, was “sourced from internally generated funds and a short-term loan.”

A PDR is a negotiable instrument issued by a depositary bank as a proxy to a company’s publicly listed stocks, giving leeway for foreign investors to buy shares in that company. Doris C. Dumlao