Sinophil readies reorganization

Holding firm Sinophil Corp. went on a two-day voluntary trading suspension ahead of a crucial board meeting seen to map out the company’s roadmap following a quasi-reorganization and clean-up of its books.

Industry sources estimated that P2.6 billion or about 74 percent of the company’s P3.5 billion capital deficit would be wiped out as part of the holding firm’s reorganization.

In a disclosure to the Philippine Stock Exchange on Friday, Sinophil said the Securities and Exchange Commission (SEC) had approved its application for quasi-reorganization, which involved the reduction in the par value of shares, the reduction in authorized capital stock, the creation of additional paid-in capital and the application of additional paid-in capital to reduce its retained deficit.

The PSE, for its part, approved the trading suspension until Monday, June 2—the day when certain matters which Sinophil said may “materially affect market activity, as well as trading prices of the shares” would be discussed by its board. Trading on Sinophil shares will resume on Tuesday, June 3.

The SEC approved an amendment of Sinophil’s charter reducing the par value of its common and preferred shares from P1 to P0.25 per share, consequently decreasing the authorized capital stock from P16.13 billion to P4.03 billion.

The amendment on decrease in authorized capital stock of the corporation will reduce its deficit which, in turn, will “significantly expedite” its ability to declare dividends to its shareholders, the company said.

Although the corporate restructuring has long been in the pipeline, Sinophil has yet to announce what core business it will embrace moving forward.

To date, the only assets in Sinophil’s books are some pieces of real estate near the upcoming Belle Grande entertainment complex and a substantial amount of Belle shares. Once the books have been cleaned up, it will have the flexibility to enter new businesses.

Sinophil, once an oil and gas exploration firm, became an investment holding firm in 1997.