MELCO RESORTS and Entertainment (Philippines) Corp. (MRP) expects its public float to fall below the required percentage after the completion of its majority shareholder’s tender offer, making it eligible to be removed from the local bourse.
In a disclosure to the stock exchange on Wednesday, MRP said MCO (Philippines) Investments Limited has completed its tender offer, where it accepted 1.34 million common shares tendered by the public, out of the total 1.57 million shares they held.
The shares are scheduled to be crossed on the Philippine Stock Exchange on Dec. 10, after which MCO Investments will own 96.1% of MRP’s outstanding capital stock. With this, only 3.9% will be held by the public.
“As such, after the crossing of the tendered shares, it is expected that MRP’s public ownership will fall below the minimum public ownership requirement under the Amended PSE Rules on Minimum Public Ownership which requires a minimum public float of not less than 10% of the outstanding capital stock,” MRP said.
The company said it will issue another disclosure after the shares are crossed from the PSE.
The PSE suspended trading of MRP shares for one hour from 9 a.m. to 10 a.m. on Wednesday to allow investors to digest this information. It also noted that the company could be delisted from the exchange if it fails to comply with the 10% minimum public ownership rule set by the Securities and Exchange Commission.
“(S)hould the company remain non-compliant with the minimum public ownership requirement, MRP shall be automatically delisted from the Official Registry of the Exchange no later than six months thereafter,” the PSE said in a notice.
MRP had intended to voluntarily delist from the PSE last October, citing its inability to raise funds through the local bourse despite efforts to maintain its listed status. The operator of the City of Dreams Manila said MCO Investments will conduct a tender offer in relation to the voluntary delisting, pricing the shares at P7.25 apiece.
Several market participants however, questioned the tender offer price with some noting that it was way below MRP share price of P14 each when it conducted its follow-on offering in 2013.
The company then withdrew its application for voluntary delisting, but decided to pursue a voluntary tender offer. MRP said this would allow MCO Investments to consolidate its shareholdings in the company.
MRP’s net income attributable to the parent surged 367% to P2.19 billion in the first nine months of 2018, while gross revenues were flat at P24.18 billion.
Shares in MRP climbed 2.01% or 14 centavos to close at P7.09 each at the stock exchange on Wednesday. — Arra B. Francia