Earmarks P491M to buy out minority shareholders

PERSONAL care product and food producer Splash Corp. has filed an official petition to voluntarily delist from the Philippine Stock Exchange (PSE), targeting Oct. 7 for its bourse exit.

It was earlier reported that Splash would go back to private hands after operating as a public company in the last nine years, taking into account “the low trading volume of Splash shares over the last 24 months, the response of the investing public to the ongoing share buy-back program and the company’s desire to avoid telegraphing its business plans to its competitors.”

Splash is offering to buy out minority shareholders who hold 26.66 percent of the country’s outstanding stock at P3.10 a share.

In a petition filed with the PSE, Splash intends to begin its tender offer on July 18 until Sept. 20.

The company has mandated local investment house Unicapital Inc. as its financial adviser for the offering.

Unicapital has confirmed that the tender offer price was “fair” and “reasonable.”  The investment house issued an opinion that Splash shares might be considered fairly valued within a range from P2.75 to P3.41 a share.

“After the termination of the tender offer to be conducted in connection with this petition, the company’s public ownership is expected to fall below the prescribed 10-percent minimum public ownership,” Splash corporate secretary Henry Yaokasin Jr. said in a July 14 letter to the PSE.

At present, the investing public owns about about 26.66 percent or 158.45 million shares of Splash, which listed on the PSE in 2007. The controlling shareholder is thus expected to shell out about P491.19 million to conduct the tender offer.

The tender offer is a requirement for companies wishing to delist voluntarily from the stock exchange. This is to give minority shareholders the chance to exit before the company reverts to private hands.

The company is currently valued by the stock market at around P1.53 billion.

Splash jacked up its net profit in 2015 by 13 times to P160 million as the company grew its sales volume while managing cost pressure. It posted an 8-percent increase in sales to P3.78 billion alongside marginal increases in costs.