BDOLF to divest from Mitsubishi financing JV

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BDO LEASING and Finance, Inc. (BDOLF) is set to divest its 40% stake in MMPC Auto Financial Services Corp. (MAFS), enabling the firm to focus on its core business.

In a disclosure on Thursday, BDOLF said it will sell its shares in MAFS to JACCS Co. Ltd., a Japan-based company engaged in consumer credit services.

“This will allow BDOLF to focus more on its core business of equipment leasing and finance,” BDOLF said in the disclosure.

Established in 2016, MAFS is a joint venture among BDOLF, JACCS, Mitsubishi Motors Philippines Corp. (MMPC) and Sojitz Corp., providing financial services to individual and corporate buyers of Mitsubishi motor vehicles.

Apart from BDOLF’s sale of its 40% stake, MMPC will also let go of its 5% share in MAFS, ultimately raising the share of JACCS in MAFS to 65%.

Japan-based Sojitz, meanwhile, will retain its 35% holdings.

“The transaction is in line with JACCS’ decision to expand its investment in MAFS as part of its strategy to accelerate the growth of its overseas business,” the statement from BDOLF added.

The transaction is still subject to closing conditions, including approvals by the relevant authorities.

Data from the Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association showed MMPC was the second-largest vehicle manufacturer in the country at end-January with a 19.48% market share at 5,239 units, trailing behind Toyota Motors Philippines Corp.

BDOLF is the leasing and financing unit of BDO Unibank, Inc., the country’s largest commercial bank in asset terms. It provides direct leases, real estate leases, leaseback arrangements as well as receivables factoring to its customers.

In 2018, BDOLF raked in some P331 million in net income, down from the P571 million recorded in 2017, dragged by the combination of increased funding costs, rising interest rates, and higher documentary stamp tax.

The firm recently received approval from the Securities and Exchange Commission to issue P15-billion worth of commercial papers to be used for re-lending and refinancing maturing obligations.

BDOFL shares closed unchanged at P2.34 apiece on Thursday. — Karl Angelo N. Vidal