Property developer Century Properties Group Inc. has approved the sale of P2.33 billion worth of shares to foreign investors.
CPG disclosed to the Philippine Stock Exchange on Friday that its principal shareholder, Century Properties Inc., sold 1.33 billion common shares to offshore investors at P1.75 per share.
This exercise will widen CPG’s public float to 17.5 percent from the current 3 percent, thereby complying with the 10-percent minimum public ownership required by the PSE to remain listed on its bourse.
The stake held by the property developer’s controlling shareholder, CPI, which in turn is owned by the Antonio family, will go down from 97 percent to 82.5 percent.
Shares of CPG had fallen by 12.92 percent to P1.82 per share, bucking the day’s main index rally to record highs—by the time trading on the stock was halted at 2:41 pm on Friday.
The company’s shares tumbled as the planned private placement was priced at a discount to market price and at the low end of the indicative price range P1.75 and P2.35 per share.
Trading on CPG will resume on Monday to give investors time to digest CPG’s disclosure about the private placement.
Half of the proceeds will be used by CPG for working capital while half will be earmarked for landbanking, the company’s disclosure said.
This equity placement will be done through a top-up offer, which means that the principal shareholder will sell some of its secondary shares to bring in new investors, but CPG will later on issue the same amount of primary shares to the principal stockholder at the same price. The principal stockholder is thus only lending some of its shares to execute a quicker equity deal instead of going through the more tedious process of applying for registration of new securities.
So while the initial stage of the deal involves a secondary shares offering, new money will effectively flow to the company as the seller will afterwards buy the same amount of primary shares at the same price.
UBS AG was mandated as the sole global coordinator and bookrunner for this transaction while UBS AG and Macquarie Capital Ltd. were appointed joint lead managers.
CPG plans invest up to P8.3 billion this year to boost development on its master-planned projects as well as to break ground on new ventures.
The company has four ongoing master-planned developments: Century City in Makati City, Canyon Ranch in Cavite, Azure Urban Residences in Parañaque City and Acqua Residences in Mandaluyong City.