MANILA Broadcasting Co. (MBC) shares rose 10.3% on Friday to P18.20, days after the company acquired more shares in an affiliate hotel business for P240 million to bring its stake to a controlling 80%.
“The acquisition aims to maximize MBC stockholders’ returns by investing in the high growth industry of hotel and resort business,” the Elizalde-owned listed media and events company told the stock exchange.
MBC said it acquired on Dec. 29, 2017 an additional 43.64% shares in Elizalde Hotels and Resorts Inc. (EHRI), an affiliated company. The purchase price was determined based on the par value of the acquired firm, it added.
Company officials did not immediately respond to phone calls for additional information on the deal.
“The closing of the transaction shall be subject to the completion of all customary closing conditions as stated in the agreement,” MBC said.
The terms of payment of the cash transaction include 25% upon subscription and 75% within a year. Standard conditions in the deal include the delivery of original stock certificates and the execution of the necessary transfer documents.
“This acquisition will increase MBC’s income through dividends and capital gains that will be beneficial to MBC stockholders,” the listed company said.
In its disclosure, MBC placed the 440,000 shares it had acquired to account for 80% of EHRI’s total 550,000 issued shares. Elizalde Holdings Corp. holds the remaining 20%. It described the acquired firm’s major project or investment as Feliz Hotel in Boracay.
MBC, which was incorporated on Sept. 30, 1947, started in radio broadcasting until it expanded to organizing special events. Its business model provides advertisers with a combination of benefits, including its AM and FM networks as well as exposure in company-led events.
MBC was the second top gainer at the Philippine Stock Exchange on Friday with a total of 181,000 shares changing hands valued at around P3.73 million. — Victor V. Saulon
