The Chemphil group has sold a controlling stake in subsidiary LMG Chemicals Corp., a shell company deemed suitable for backdoor-listing, to a group that includes an industrial auctioneer.
In a disclosure to the Philippine Stock Exchange on Monday, LMG said its principal shareholder Chemical Industries of the Philippines Inc. (Chemphil) had signed a deal to sell a 65.92 percent stake in LMG to Dominic Sytin and Robinson Siao for P405 million.
The closing and completion of the sale would still be subject to the fulfillment of certain conditions, including the conduct of a tender offer by Sytin and Siao in accordance with the requirements of the Securities Regulation Code, the disclosure said.
Sytin is the founder and chief executive officer of United Auctioneers Inc., an industrial auction company which operates out of Subic Bay but likewise has an office in Davao. It operates a marketplace for industrial machines, trucks and other miscellaneous equipment from Japan, the United States, Europe and other Asian countries.
Based on its website, In the next 10 years, United Auctioneers plans to expand operations through the Asia Pacific region.
The Sytin family is also involved in automotive assembly and distribution business using the Chinese brand Foton. Last year, a P1.2-billion Foton assembly plant was inaugurated in Clark. Dominic Sytin chairs Foton Philippines.
The family is also into mobile distribution, having introduced to local consumers the “Happy Mobile” brand as a low-cost smart phone alternative, industry sources said.
Trading on LMG was halted from 9am to 10 am on Monday to give investors time to digest this material information.
LMG was previously an industrial chemicals manufacturer and distributor. In 2007, LMG transferred its acid plant and tank farm properties to wholly-owned subsidiaries, Chemphil Manufacturing Corp. and LMG Land Development Corp. to consolidate the acid plant and tank farm operations into individual holding companies “for better management and monitoring.” Starting 2009, upon divestment of its subsidiaries, the company’s operations shifted to trading.
The company divested more assets over the years. As a result, LMG is now only engaged in the trading of chemical products such as caustic soda, sulfur and other industrial chemicals.