Tanco-owned schools list via backdoor

Holding firm JTH Davies Holdings Inc. has obtained consent from shareholders to transform itself into a vehicle for the education assets of the group of businessman Eusebio Tanco, such as STI Education Services Group and Philippine Women’s University.

JTH—which will be renamed STI Holdings Inc. subject to approval of charter amendments by the Securities and Exchange Commission— also obtained approval to beef up its capital stock and complete private placement and share swap arrangements that will infuse the group’s assets into the company.

“The important thing is that we’re putting in the educational assets of the Tanco group—the STI services group plus PWU into JTH,” JTH president Monico Jacob said in an interview on Friday.

The company’s authorized capital stock will be raised to 10 billion shares. It currently has 1.1 billion shares of which 307.18 million are issued and outstanding.

After the consolidation of Tanco’s assets into JTH, Jacob said the company would work on a follow-on offering to raise capital for expansion. This will likely happen within the year, he said.

“We are expanding STI, for instance acquiring a building in Caloocan. We’re expanding in the next two years,” he said.

Shareholders of JTH approved on Friday the private placement of 795.82 million in new common shares, of which 397.91 million each will be issued to Capital Managers and Advisors Inc. (CMA) and STI. These shareholders waived the requirement to conduct a rights or public offering in connection with the private placement.

These 795.82 million shares refer to those already bought and paid for by CMA and STI at P0.60 per share through private placement. Since STI and CMA are related parties, they were required under Philippine Stock Exchange rules to seek shareholder approval for the listing of these privately placed shares.

Likewise approved was a share-for-share swap with STI stockholders using an exchange ratio of 6.5 JTH shares for every one STI share. As such, a minimum of 2.65 billion JTH shares will be issued to STI majority stockholders. The requirement to conduct a rights or public offering was likewise waived in connection with this transaction.