Yuchengo-led House of Investments sets new focus

MANILA, Philippines  —The Yuchengco Group’s House of Investments (HI) saw its shares rally over 8 percent on Monday after announcing a pivot to financial services, fueling market speculation it could also consolidate other family assets into the publicly-listed holding company.

The company, which sold majority of its shares in construction giant EEI Corp. to outside investors, including the family of House speaker Martin Romualdez, is aiming to become an “extensive conglomerate” after announcing a groupwide reorganization.

HI shares jumped 8.07 percent to P3.48 each on thin trading volume while the broader Philippine Stock Exchange index slumped 0.31 percent.

HI is still down from its May 3, 2023 high of P5.39 per share after the stock price surged in the aftermath of the sale of a 20-percent stake in EEI to Romualdez’s RYM Business Management Corp. for P1.25 billion.

READ: Yuchengco Group selling 20% stake in EEI to Martin Romualdez’s firm

“HI will undergo a transformation with financial services as a core investment replacing construction,” HI said in a stock exchange filing on Monday.

“The reorganization will create a new financial services unit under HI comprised of Malayan Insurance, Sun Life Grepa Financial, and its existing 40-percent stake in RCBC Trust Corp,” it said.

“This foray into financial services underscores Hl’s commitment to diversification and its ambition to play a more substantial role in the Philippine financial industry,” it added.

COL Financial Group chief equity strategist April Lynn Tan said the transformation plan might be a prelude to HI acquiring the Yuchengo family’s shares in banking giant Rizal Commercial Banking Corp., which is owned by HI’s unlisted parent firm.

Tan clarified COL Financial currently has no formal coverage of HI.

HI said it was also diversifying into infrastructure after joining consortiums bidding for the P170-billion Ninoy Aquino International Airport privatization in Manila and the Sangley Airport project in Cavite province.

READ: Virata-Yuchengco group’s Sangley airport offer Okayed

It also announced plans to expand its property portfolio with the acquisition of the 184-hectare property located at Central Techno Park in Luisita Industrial Park.

“Aiming to be an extensive conglomerate, we are putting in the groundwork necessary to make HI a bigger and better company. This initiative is centered on the reorganization of the group to amplify its overall value proposition, demonstrating HI’s continuous business development and its pursuit of growth opportunities across multiple sectors,” Lorenzo V. Tan, president and CEO of HI, said in the filing on Monday.