Holcim PH dominant investor offers to buy out minority at P5.33 a share

MANILA  -The major shareholder of Holcim Philippines will launch a buyout offer to minority stockholders next week at P5.33 per share, with the goal of taking the domestic cement giant private.

The price, which values the tender offer at P1.73 billion, was 35-percent higher than the company’s share price before the deal was announced last June 29.

Trading of Holcim Philippines’ shares has been suspended since then, which was also after the company disclosed that its public ownership level fell below the minimum 10 percent. The company’s shares last traded at P3.87 each.

Amsterdam-based Holderfin B.V., which is part of the Holcim Group of Switzerland, is offering to buy out the remaining 5.05 percent held by the minority stockholders.

This will allow the controlling shareholders’ group to consolidate full control of the company before launching voluntary delisting proceedings under the rules of the exchange.

The tender offer price was determined via a fairness report from ING Bank. It was hired by Holderfin on June 26 or three days before the Philippine office disclosed the proposed tender offer and subsequent privatization.

ING, whose report was made public, came up with a price range of P4.73 per share to P5.33 per share. “Based on the foregoing, we are of the opinion that Holderfin’s tender offer price of P5.33 per share is fair from a financial point of view,” ING concluded in the report.

Lower net income

Holcim Philippines is a leading cement maker operating four factories with a total annual production capacity of 10 million metric tons.

The delisting follows other privatization moves by large listed companies as uncertain economic prospects weigh on business valuations.

Holcim PH to be delisted from stock exchange

Holcim Philippines’ financials in the first quarter of 2023 showed net income fell 15 percent to P356 million while sales sank 1.5 percent.

Weak demand weighed on Holcim PH’s income in Q1

The current tender offer values Holcim Philippines at P34.4 billion. This is nearly 70 percent less than conglomerate San Miguel Corp.’s (SMC) proposed buyout in 2019, when the cement firm’s shares were trading at a much higher price.

SMC abandoned the acquisition a year later after the deal was challenged by the Philippine Competition Commission. Last year, the conglomerate fully acquired Eagle Cement and privatized the firm through a voluntary delisting.

SMC’s Holcim PH takeover deal falls through