Exchange starts delisting Uniwide

The Philippine Stock Exchange is moving to remove Uniwide Holdings Inc. from its roster of publicly listed companies, citing the defunct retailer’s dissolution and continuing violation of disclosure rules.

In a notice to investors Friday, the PSE said it had initiated involuntary delisting proceedings against Uniwide, citing among others, failure to submit structured reportorial requirements, particularly annual reports from 2013 to 2015, as well as first to third quarterly reports for the years ended 2014 to 2016.

The bourse said Uniwide had also failed to submit on time the reports on the number of shareholders in 2014 and 2015, foreign ownership reports in 2014 and 2015, top 100 stockholders report in 2014 and public ownership report in 2014.

The PSE also cited the Securities and Exchange Commission (SEC)’s order for the dissolution and liquidation of assets of all companies in the Uniwide group.

In issuing such order, the SEC said the Uniwide group had been “insolvent” since 2003, which meant that the company had more liabilities than assets.

Likewise cited by the SEC was the group’s high debt-to-asset ratio exceeding 1 since 2003 and which has swelled to 4.51 in 2009. A debt ratio greater than 1 means the company has negative net worth and is technically bankrupt. Furthermore, the SEC had said there were no indications that fresh capital was coming to rescue the Uniwide group.

At the time of the filing of the original petition for debt relief in 1999, the Uniwide group operated eight warehouse clubs and two department stores, with total assets of P19.86 billion and total liabilities of P11.1 billion.

Based on the SEC’s assessment, the Uniwide group had metamorphosed over the years from being “solvent but distressed” to “technically insolvent” to “unmistakenly insolvent.”

Once delisted, a company cannot apply for relisting within a period of five years.  Another painful consequence is that directors and executive officers of the delisted company are disqualified from sitting as directors or executive officers of any company applying for listing within the same five-year period from delisting.

Following receipt of this involuntary delisting notice, Uniwide is entitled to a hearing provided a written request is filed with the PSE within 15 days.  Otherwise, the PSE will decide solely on the basis of the records on hand. —DORIS DUMLAO-ABADILLA