Holding firm may transform into backdoor listing vehicle

MANILA, Philippines—Holding firm Southeast Asia Cement Holdings Inc. (Seacem) is reviewing its options to transform itself into a backdoor listing vehicle after completing a share buyback that widened the public float of subsidiary Lafarge Republic Inc. (LRI) but reduced its own public ownership.

Based on disclosures to the Philippine Stock Exchange on Monday, Seacem has completed a voluntary tender offer to buy back its own shares in exchange for a mix of shares in LRI and cash. This exercise allowed LRI to meet the 10-percent minimum public float required to remain listed on the PSE but shrunk Seacem’s own float to 2.4 percent.

But Seacem shrugged off market expectations that it may voluntarily delist from the PSE now that its public float had been reduced to a level below the minimum requirement. Prior to the buyback transaction, Seacem had a public ownership of 16.49 percent.

“Seacem is reviewing its options to comply with the 10-percent minimum public float requirement, in the context of, among others, possibilities for consolidating assets and investments, and opportunities for entering into transactions with third party (or parties) interested in a backdoor listing,” said Seacem corporate secretary Ruby Sarah Nitorreda.

She said the specific actions and the terms and conditions would be timely disclosed when these have been determined by the Seacem board.

In the disclosure, Seacem said it sold 249.52 million LRI shares in exchange for 930.73 million of its own shares. In a separate disclosure, LRI said the sale increased LRI’s public ownership to 10.29 percent or 599.07 million shares, thus meeting the minimum requirement.

Shares of Seacem rose 1.46 percent to close at P2.08 each on Monday after the company unveiled the tender offer results as well as the backdoor listing options. LRI shares also jumped 2.53 percent to close at P9.74.

An associated company of international building materials leader Lafarge, LRI earlier announced plans to increase its production capacity by the first quarter of 2013, supplying an additional one million tons of cement a year throughout the Philippines after a set of investment projects has been completed.

Originally posted at 05:14 pm | Monday, November 19, 2012