ROXAS and Company, Inc. (RCI) is looking at raising funds through an equity placement of up to P800 million with global investment group LDA Capital Ltd.
In a stock exchange disclosure Tuesday, RCI said its board of directors allowed the corporation to enter into a put option agreement for an equity placement commitment with LDA Capital.
A put option is an agreement that allows a company to sell an underlying security at a pre-determined price.
“This equity placement commitment is part of RCI’s fund-raising activities aimed at strengthening its subsidiaries, with the proceeds to be utilized for additional working capital and to support the reduction of bank debts to manageable levels,” RCI said.
Under the terms, LDA Capital Ltd. will be the investor and LDA Capital LCC will be the arranger of the transaction. RCI will control the timing and maximum amount of the put option, which should be within 36 months from the signing of the deal.
RCI’s board of directors also approved granting a call option to the investor, which essentially allows LDA Capital to buy up to 99 million common shares in RCI at P2.38 each.
The plan of the company is to sign the put option agreement today, June 17.
RCI is a Philippine firm with interests in real estate, sugar and ethanol manufacturing. Some of its subsidiaries are Roxaco Land Corp. and Roxas Holdings, Inc.
LDA Capital, on the other hand, is an alternative investment group engaged in global public equities, private equity and credit. On its website, it said some companies in its portfolio are Ansen Corp., GetSwift, L’Officiel USA and Smart Energy Sweden Group AB.
Shares in RCI at the stock exchange closed P1.90 each on Tuesday, up 10 centavos or 5.56% from the previous day. — Denise A. Valdez