October 14, 2019
The Philippine Stock Exchange (PSE) is set to conduct another share buy-back transaction to further decrease the shareholdings of its brokers as part of compliance.
At the sidelines of a listing ceremony last week, PSE President and Chief Executive Officer Ramon Monzon told reporters they would be repurchasing around 1 million shares for P183.93 apiece.
“We are having our second compliance exercise. What are we doing now? We are having a directed buy-back of shares,” he explained.
This, after buying back 2.42 million shares for P183.93 apiece or P445.10 million in total in September.
PSE began buying back common shares in August from its broker shareholders to reduce their shareholdings to 20 percent. It was authorized to repurchase up to P532.01 million worth of shares.
Monzon said that broker ownership was reduced to some 26 percent from the pre-transaction level of 28 percent after buying back said shares.
It would also be asking brokers to swap their common shares with non-voting preferred shares to lower their shareholdings should they decide not to sell.
“[Some brokers indicated] they wanted to swap more than 1 million shares. Now it is a question of us trying to talk to them, to convince them,” he said.
PSE announced earlier it requested for the creation of 3.5 million preferred shares for P1 apiece. These shares are non-voting, cumulative, non-participating, non-convertible and redeemable.
Meanwhile, PSE said it was still addressing the common shares being held by its broker First Metro Investment Corp. under a firm underwriting agreement.
“Since they have a firm underwriting agreement with PSE, they have to absorb the shares,” explained.
Monzon said these shares represent a “substantial” portion or about 3.4 percent of the shareholdings.
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