VULCAN Industrial & Mining Corp. said Zap Cove Development Corp. will be subscribing to around three billion shares in the company, in a potential backdoor listing move.
In a disclosure to the stock exchange on Wednesday, Vulcan said its board of directors approved in a special meeting the subscription of Zap Cove to up to 2.55 billion shares in the firm out of its authorized but unsubscribed capital stock with a par value of P1 each.
Zap Cove was also granted the subscription rights to over 486.96 million shares partially paid shares held by National Book Store, Inc. (NBS). It will likewise assume NBS’ obligation for the unpaid subscription price on the shares.
With the share subscription by Zap Cove, Vulcan said it will cease to “engage in the business of mining, oil, petroleum, industrial development, and mineral processing.
The company requested for a voluntary trading suspension earlier in the day prior to the conduct of its board’s special meeting, saying they will discuss material information that will affect the future of its businesses.
The Philippine Stock Exchange approved the company’s request, suspending the trading of its shares from today (Oct. 31) until the market opens on Nov. 5.
“The trading suspension will enable the Company to provide its shareholders and the investing public with equal opportunity to (a) examine the details of the results of the Board meeting, and (b) fully appraise their investment position in VUL shares in light of such results,” the company said.
Shares in the company last traded at P2.49 each on Tuesday.
Incorporated in 1953 originally as Vulcan Manufacturing Corp., the company engages in finding, developing, and producing oil and gas reserves and other mineral properties.
The company is owned by the Ramos family, which also leads Atlas Consolidated Mining and Development Corp. and NBS.
NBS previously planned to use Vulcan as the backdoor listing vehicle for its retail assets, but decided to no longer pursue the exercise in 2017. The company however, said it will explore alternative strategies to “generate the most value to its shareholders.”
With no revenue-generating activities under its portfolio, Vulcan widened its attributable loss to P1.57 million in the first nine months of 2018, versus P1.46 million in the same period a year ago. — Arra B. Francia
