Bourse seen acquiring additional PDS shares

The Philippine Stock Exchange aims to buy more Philippine Dealing Systems Holdings Corp. (PDS) shares in line with the planned unification of the country’s capital market infrastructure.

In a statement, the PSE said it was targeting to sign more deals to buy PDS shares in the coming weeks.  To date, the bourse is already in control of 61.04 percent of PDS shares.

The PSE earlier signed deals to buy out four shareholders of PDS, including the Bankers Association of the Philippines, Finex Research and Development Foundation Inc., Whistler Technology Services Inc., and Insular Investment Corp. which have a combined ownership in PDS of 40.06 percent.

For its part, the PSE has long held a stake of 20.98 percent in PDS, the holding firm for fixed-income trading platform Philippine Dealing and Exchange Corp. (PDEx), Philippine Depositary and Trust Corp. (PDTC) and Philippine Securities Settlement Corp.

“We are optimistic and excited about the benefits that this landmark transaction can bring to the market and we appreciate the support from all the stakeholders,” PSE president Hans Sicat.

Another significant stockholder of PDS is Singapore Exchange Ltd., which was earlier reported to be warming up to the idea of selling its stake, which can give the local bourse more flexibility in its quest to merge the country’s bond and stock markets. Gaining control of more than two-thirds of PDS will allow a merger under corporate laws in lieu of the other option of operating PDS as a subsidiary.

The unification is seen to result in a stronger, deeper, more transparent capital market infrastructure under the PSE.

The PSE’s purchase of PDS shares, however, is still subject to the approval of the Securities and Exchange Commission (SEC).

“We have had numerous discussions with the Department of Finance, the BSP, and the SEC on this matter. We look to them to support this process of consolidating the equities and fixed income exchanges which will further align the Philippine capital markets with the global markets,” Sicat added.

What the PSE needs from the SEC to pursue this deal is an exemptive relief from a provision in the local securities law that no single industry can own more than 20 percent of an existing exchange.

SEC chair Teresita Herbosa earlier said the SEC would like to see that all pertinent issues were settled before extending such relief.