PSE firms up PDS takeover with purchase of biggest share block

The Philippine Stock Exchange (PSE) has gained control of an initial 49.91 percent of Philippine Dealing System Holdings Corp. (PDS Group) as part of its renewed P2-billion bid to unify the country’s capital market infrastructure.

In a disclosure on Thursday, the PSE said it had signed an agreement to resume discussions for the purchase of a 28.91 percent held by the Bankers Association of the Philippines, the single biggest stockholder of PDS.  Subject to terms and conditions, the parties intend to execute an amended share purchase agreement not later than May 31.

As the PSE already owns 21 percent of 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.—the agreement with BAP will give the local bourse effective control of around half the voting shares of PDS.

The disclosure provided scant details on the transaction but Inquirer sources said the new deal with BAP valued the PSE’s rekindled takeover bid at P2 billion for 100 percent of PDS, slightly lower than the P2.25 billion valuation in 2015, to price in the potential exclusion of the government securities over-the-counter business under PDEx.

“This occasion underscores our commitment to see a unified equities and fixed income exchange. We remain cognizant of the advantages of this consolidation to capital market stakeholders and the Philippine economy and we hope to realize these benefits the soonest possible time,” PSE President Hans Sicat said.