Corporate News

Phinma transfers 5 universities to education holding firm

Posted on November 14, 2015

PHINMA Corp. said it has moved to transfer its P4.15 billion stake in the group’s education businesses to the holding firm controlling its investments in schools.

In a disclosure to the stock exchange yesterday, the company said Phinma Education Holdings, Inc. is buying the parent’s shares in Southwestern University (SWU) for P2.54 billion, University of Pangasinan, Inc. for P579 million, University of Iloilo for P468 million, Araullo University, Inc. for P300 million and Cagayan de Oro College, Inc. for P265 million.

At the same time, Phinma Education will avail of a P2.5-billion term loan, but the disclosure did not specify if the debt will be used to fund the purchases.

Phinma Education has said that the stakes involved are 78.6% in Araullo University, 74.2% in Cagayan de Oro College, 69.8% in University of Pangasinan, 69.8% in University of Iloilo and 63.5% in SWU.

The conglomerate set up the holding firm for its investments in education ahead of a plan to go public, but its maiden share sale could be pushed back to 2019 -- later than the original target of 2017 -- as the listed firm weighs the impact of the changes in the country’s educational system, Phinma Chairman and Chief Executive Officer Ramon R. del Rosario, Jr. said in September.

“We want to go back to our regular normal operations where we have incoming freshmen again. We want revenues to stabilize first so we can maximize the benefits of going public,” Mr. del Rosario had said.

Under the Kinder to Grade 12 reform program, the Department of Education added two more years to the existing 10-year basic education curriculum, putting the country on a par with international practice.

With kindergarten as base, K-12 will have six years of elementary (Grades 1 to 6), four years of junior high school (Grades 7 to 10), and two years of senior high school (Grades 11 and 12).

By 2016, Grade 11 will be implemented with fourth year high school students moving on to senior high school instead of going to college, leaving many colleges and universities without freshmen enrollees.

The Phinma group also has interests in energy, housing, hotels, steel manufacturing and business process outsourcing for animation services.

Shares in Phinma rose 52 centavos or 4.56% to finish at P11.92 on Friday. -- Krista Angela M. Montealegre