Davao’s Uy continues acquisition spree

Davao-based businessman Dennis Uy has struck a deal to acquire publicly listed H20 Ventures Corp. (H20), widely expected to be a potential backdoor listing for one of the businesses under his fast-growing corporate empire.

Uy’s privately held holding firm Udenna Corp. agreed to buy a 62-percent stake in H2O but the seller, Jolliville Holdings Corp., must spin off the water utility businesses. This suggests that Udenna is more interested in the shell company than the underlying operations.

Udenna, in turn, will launch a mandatory tender offer to the minority shareholders of H20 to comply with local securities law.

“One of the conditions to the H2O sale is the implementation and completion by H2O of a spinoff by selling all of its existing business and assets, including shares and interests in Calapan Waterworks Corp (CWWC) and all other interests in other corporations,” a disclosure by H20 said.

Apart from spinning off the water business, H2O must also do a “clean-up” exercise—collect all receivables, settle all its obligations, assign its contractual interests, transfer or reassign all of its employees and settle and dissolve its retirement fund, the disclosure said.

Joliville, led by businessman Jolly Ting, said it believed that the proposed transaction would create value for the company. The price of the transaction was not disclosed.

Among the businesses that market players expect Uy to infuse into H2O is his upcoming Cebu casino venture. Another possibility, other market sources said, could be the holding firm Udenna itself.

On the casino business, Udenna has obtained a provisional license from the state-controlled Philippine Amusement and Gaming Corp. (Pagcor) to develop a $300-million integrated gaming resort in Mactan, Cebu. This will be the country’s first privately run integrated resort and casino outside Metro Manila.

Udenna expects to break ground for the integrated resort and casino in three months. It targets to complete the development in 2022, with the casino, retail complex and hotels scheduled to open as early as 2019. Udenna’s wholly owned subsidiary Udenna Development Corp. (Udevco) will build the integrated gaming resort, to be called Lapu-Lapu Leisure Mactan, which will rise on a 12-hectare prime beachfront property.