CEMEX Holdings Philippines, Inc. (CHP) said it has obtained clearance from corporate regulators for its plan to conduct a stock rights offer (SRO) that will raise as much as $250 million (approximately P12.66 billion).

In a disclosure to the stock exchange Monday, the cement manufacturer said it received approval from the Philippine Stock Exchange, Inc. (PSE) and the Securities and Exchange Commission last week for the planned SRO, wherein the company will offer an additional 13,115,000,000 common shares to existing shareholders.

“The Offer is expected to be made to all Eligible Shareholders of the Company as of 14 January 2020, at a discount to the volume-weighted average price of CHP common shares listed on the PSE for a period to be determined prior to January 6, 2020,” it said.

The offer period is targeted to begin on Jan. 20 and last until Jan. 24. Cemex tapped The Hongkong and Shanghai Banking Co. Ltd., Singapore Branch as global coordinator and BDO Capital & Investment Corp. as domestic underwriter for the transaction.

The SRO will be open to existing common shareholders that are based in the Philippines or are in jurisdictions outside the country and the United States where it is legal to participate.

Cemex said the cash to be generated from the SRO will primarily be used to fund the expansion of its Solid Cement plant in Antipolo, Rizal; pay the outstanding amounts its subsidiary Solid Cement Corp. owes through a revolving credit facility to CEMEX Asia B.V.; pay its loan agreement through subsidiary APO Cement Corp. with CEMEX Asia B.V.; and additional funding for other general corporate purposes.

The company announced in April it is increasing its authorized capital stock to 18.31 billion common shares priced at P1 each, from 5.195 billion common shares priced at P1 apiece to raise the additional cash.

Cemex said its controlling shareholder, Cemex Asian South East Corp. (CASE), committed to subscribe “not just its entitlement of the rights shares in the initial round of the Offer, but also to subscribe any unsubscribed rights shares in the mandatory second round of the Offer under the same terms and conditions as any other Eligible Shareholder.”

The company booked a net income of P874.68 million in the nine months to September, a turnaround from last year’s net loss of P663.43 million, driven by “higher operating earnings, foreign exchange gains and lower income tax expenses.”

Cemex shares at the stock exchange slipped 0.06 points or 2.82% to P2.19 each on Monday. — Denise A. Valdez

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