DoubleDragon carts 35% of MerryMart for P1.28B

MANILA, Philippines — DoubleDragon Corp. is expanding into the grocery business via MerryMart Consumer Corp. in a P1.28-billion deal seen expanding the developer’s ecosystem.

The property venture of tycoons Edgar “Injap” Sia II and Tony Tan Caktiong disclosed to the stock exchange on Wednesday it would buy 2.66 billion common shares of MerryMart held by Injap Investments Inc., the holding company of Sia.

This represents a 35-percent stake in MerryMart.

According to DoubleDragon, the transaction price is based on MerryMart’s 30-day volume-weighted average price of P0.48 per share.

In all, this values MerryMart at around P3.65 billion.

The developer will pay half of the transaction in cash, and the other half using DoubleDragon shares.

READ: DoubleDragon eyes P500-B revenues by 2035

Tender offer

DoubleDragon is also required to conduct a tender offer of MerryMart shares held by the latter’s remaining shareholders, subject to regulatory approvals.

Mandatory tender offers give minority shareholders a chance to exit at favorable prices.

However, Juan Paolo Colet, managing director at China Bank Capital Corp., said the tender offer price may not be attractive to public shareholders because it was lower than that of MerryMart’s market price of P0.58 each as of Wednesday.

In venturing into the grocery industry, DoubleDragon, whose main business is property development, said this would complement its ecosystem as an investment holding company.

READ: DoubleDragon appoints new president

Holding firm

DoubleDragon in 2021 officially changed its corporate name from DoubleDragon Properties Corp., transforming into an investment holding firm from purely real estate.

“MerryMart [will] add value to the existing investment portfolio of the DoubleDragon Group with its chain of provincial community malls, its string of office buildings, warehouse complexes and hotels,” DoubleDragon said.

The firm added that the move would also nudge it closer toward its goal of reaching P500 billion in revenues by 2035.

Colet noted that the deal may be a prelude to DoubleDragon eventually taking a majority stake in MerryMart. INQ