PSE’s final 10: San Miguel, Ongpin, Lucio Tan units among non-compliant firms

MANILA, Philippines – Ten listed firms have failed to comply with the public ownership rule over a year after the Philippine Stock Exchange (PSE) announced it as part of governance and capital market development efforts.

After the market closed on Friday, December 28, the last trading day of 2012 and the deadline to comply with the minimum 10% public ownership rule, the following firms face trading suspension and higher transaction taxes by January 2, 2013:

1. Alphaland Corp – 8.03%
2. Southeast Asia Cement Holdings Inc. – 6.79%
3. PAL Holdings Inc – 2.3%
4. Allied Banking Corp – 2.3%
5. San Miguel Brewery, Inc – 0.61%
6. PNOC Exploration Corp – 0/21%
7. San Miguel Properties, Inc – 0.06%
8. Philcomsat Holdings Corp – 9.6% (already under trading suspension)
9. Cosmos Bottling Corp – 1.79% (under trading suspension)
10. Nexstage, Inc – 1.2% (under trading suspension)

The previous 11th firm — Manchester International Holdings Unlimited Corp — was able to comply with the PSE rule after Melco Crown, sold additional Manchester shares to the public, boosting the former pharmaceutical company’s public ownership to 11.84% from 6.79%.

Melco Crown recently acquired control of Manchester as part of the casino company’s backdoor listing strategy.

In the list above, the brewery and property units of San Miguel Corp, the country’s biggest business group, joins units of tycoon Lucio Tan, Allied Bank and PAL Holdings. San Miguel has minority stakes and control Philippine Airlines, a unit of PAL Holdings. Another tycoon, Roberto Ongpin, controls Alphaland, another property firm.   

No extension

There were 41 errant firms in November 2011 when the PSE gave a 12-month grace period or until end-2012 to meet the minimum public float rule.

In a December 28 memorandum, the PSE said it denied requests to extend the deadline.

“The Commission resolved to deny the request for extension of the grace period to comply with the amended MPO (minimum public ownership) rule for the reason that any grant of an extension of the grace period will result [in] a disorderly market.“

Previously, San Miguel Brewery, San Miguel Properties, and Southeast Asia Cement Holdings wrote the exchange to provide the additional time to comply with the rule. 

In separate disclosures to the stock exchange, they said they have received notices on their shares’ trading suspension on January 2. 

Southeast Asia Cement explained it is “working on its options in the context of, among others, possibilities for consolidating assets and investments, and opportunities for entering to transactions with third parties.”

Among those that delisted ahead of the deadline were: Eton Properties Philippines Inc, First Metro Investment Corp, Metro Pacific Tollways Corp, Alaska Milk Corp, PLDT Communications and Energy Ventures Inc, Keppel Philippines Marine Inc, and Chinatrust (Philippines) Commercial Bank Corp had taken the delisting route because of their inability to meet the said rule.

Consequences

“Immediately after December 31, 2012, the Exchange shall impose a trading suspension on the shares of non-compliant listed companies beginning January 2, 2013, for a period of not more than 6 months, or until June 30, 2013,” the exchange said.

“If after June 30, 2013, a listed company remains non-compliant, the listed company’s shares shall be delisted effective July 1, 2013,” it stressed.

The Bureau of Internal Revenue will also impose a 5% to 10% capital gains tax and documentary stamp tax on every stock transaction of these firms, far more than the current tax rate of 0.5% and exemption from the documentary stamp tax. – Rappler.com