RCBC to sell 15% stake to Hexagon Investments

MANILA, Philippines—The Yuchengco-led Rizal Commercial Banking Corp. has firmed up a deal to sell a 15-percent stake to a unit of global private equity firm CVC Capital Partners, completing its medium-term capital build-up program ahead of stringent global capital adequacy standards.

The RCBC disclosed on Wednesday that it had assigned to Hexagon Investments BV its rights and obligations covering 5.82 million in treasury-held shares as well as new common shares – minimum of 120.73 million and a maximum of 165.178 million shares – to be issued out of its un-issued capital stock.

As part of the deal, another 75 million shares will be issued to Hexagon to be taken out of a proposed 300-million increase in capital by RCBC subject to final approval by the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission.

The bank disclosed that its board recently approved the offering of these shares to the new investor, Hegaxon.

Hexagon Investments is an Amsterdam-based company duly incorporated and existing under the laws of the Netherlands last May. It is owned by a holding firm controlled by the CVC Capital Partners group.

The CVC Capital Partners group earlier agreed to buy a 15-percent stake in the bank for P4.96 billion. This investment will bring up RCBC’s capital adequacy ratio and core tier1 ratio to 19.89 percent and 14.9 percent, respectively.

Proceeds from the investment are intended to support lending activities, including large corporate clients, consumers, small and medium enterprises and microfinance segments.