Lucio Tan folds assets into one company
MANILA, Philippines - Tycoon Lucio Tan is consolidating all his assets -- from beverage to airlines -- under Tanduay Holdings Inc, which will be renamed as LT Group Inc.
The move will diversify the company's investments, give it easy access to funding, enable synergies in several areas such as marketing and distribution, as well as enhance shareholder value, Tanduay, which currently holds Tan's distillery business, told the Philippine Stock Exchange (PSE) in a disclosure on Tuesday, July 31.
Tanduay said its board of directors approved the acquisition of shares in the following Tan-owned companies:
1. Asia Brewery Inc - 1.8 billion shares representing 90% of the company for P1.8 billion.
Asia Brewery is a non-listed manufacturer and distributor of alcoholic and non-alcoholic beverages, bottled water and packaging materials. Among its brands are Colt 45, Manila Beer, Coors and Tanduay Ice.
2. Fortune Tobacco Corp - 1.65 billion shares representing 83% of the company for P1.65 billion.
Fortune Tobacco has a 50-50 joint venture with Philip Morris Philippines Manufacturing Inc that manufactures and distributes cigarettes under the Philip Morris, Marlboro, Hope, Champion and Fortune brands.
3. Eton Properties Philippines Inc - 98% of Eton via the acquisition of 100% of Eton shareholders -- Paramount Landequities Inc and Saturn Holdings Inc -- which are both controlled by Tan.
Eton is a developer of residential, commercial and office projects.
4. Philippine Airlines (PAL) - 49.8% of PAL through the acquisition of 100% of Buona Sorte Holdings, which owns 51% of Trustmark Holdings Corp, which, in turn, owns 99..45% of PAL Holdings. PAL Holdings owns 97.7% of PAL.
San Miguel Corp owns another 49% stake in PAL Holdings after a deal with Trustmark Holdings early this year.
5. Air Philippines Corp - 50.97% of AirPhil through the acquisition of 100% of Cosmic Holdings, which owns 51% of Zuma Holdings and Management Corp. Zuma, in turn, owns 99.95% of AirPhil.
San Miguel also owns 49% of AirPhil.
6. Philippine National Bank (PNB) - 34.79% of the bank through the acquisition of 100% of 11 holding companies that own stakes in PNB.
7. Allied Banking Corp - 27.62% of Allied through the purchase of 100% of 2 holding companies that own stakes in the bank.
PNB and Allied Bank are merging via a share-for-share swap deal that will create the country's 4th largest privately owned bank. PNB will be the surviving entity.
Tanduay said the acquisitions "are expected to be completed by end of September 2012."
It added they will be financed by proceeds of a capital hike earlier approved by its shareholders.
On July 27, shareholders of Tanduay okayed the hike in the authorized capital stock of the corporation to P25 billion from P5 billion.
Tan-controlled Tangent Holdings Corp, parent of Tanduay, is subscribing to P5 billion of the P20 billion capital hike.
Tangent's additional investment will bring Tanduay's public ownership below the 10% minimum threshold required by the PSE.
"Management was further directed to study and recommend measures to enable compliance with the minimum ownership requirement," it said. - Rappler.com