Aboitiz quashes rumors on sale of Union Bank

Aboitiz Equity Ventures Inc. has no plans to sell its controlling stake in profitable banking unit Union Bank of the Philippines.

In a disclosure to the Philippine Stock Exchange on Monday, Aboitiz Equity denied market rumors that Union Bank would be merged with either Bank of the Philippine Islands or Rizal Commercial Banking Corp.

“AEV is not in any way involved in discussions with any person or entity for the sale of its shares in UBP or in a merger between UBP and BPI or RCB,” Aboitiz said in its disclosure.

In separate disclosures, Union Bank, BPI and RCBC also denied the rumors that they were in merger discussions with the Aboitiz-led bank.

“We are also not aware and do not know the basis of the market talk of a possible merger,” the BPI disclosure said.

Aboitiz-affiliated stocks sizzled last week when rumors about a merger and acquisition play on Union Bank of the Philippines started circulating.

Union Bank shares were up by 30 percent last week alone to end at P135 per share on Friday, surging mostly in the last two trading days and thus lifting shares of parent firm Aboitiz Equity Ventures and power unit Aboitiz Power.

The disclosure that there was no truth to the rumors triggered profit-taking on Union Bank shares on Monday.

The share price of the bank—the most actively traded stock in the market—fell by 15.5 percent to P114 per share.

Affiliate Aboitiz Power also tumbled by 5 percent to P32 a share.

A top Union Bank official said that, as far as management is concerned, he was not aware of any such deal in the works.

The official also pointed out that whenever shareholders were about to undertake serious moves—like the I-Bank acquisition in 2006—management would be immediately involved.

The bank official said that the Aboitiz sale of Union Bank shares had been a recurring rumor over the last five to seven years.