Delisting bid of MPIC back to square one–pangilinan

EFFORTS to take conglomerate Metro Pacific Investments Corp. (MPIC) into private ownership are back to square one as the bidders will have to get another accredited independent advisor to determine the right price for the transaction.

Manuel V. Pangilinan, MPIC chairman, president and CEO, said regulators have disapproved the report given by its first independent financial advisor (IFA) as it was “not independent enough.”

Pangilinan is also part of the group that will buy the shares owned by the public.

“So the bidders have to have to appoint a new IFA. So you know you’re back to square one. We will have to most likely appoint a new IFA, and then the process will then restart after IFA determines the price,” he said at the sidelines of MPIC’S annual stockholders’ meeting.

“Then you’re going to have to submit that again to the PSE [Philippine Stock exchange] and SEC [Securities and exchange Commission].”

Pangilinan said they were given a list of accredited IFAS, and their choices have whittled down to two.

He said they were in indirect talks with other minority holders, such as the pension funds.

“You know, any price point you put at the table will be considered low. We know that. It’s typical of any of any tender (offer) right, your initial indication would be would be regarded as low. So that’s how the markets operate,” Pangilinan said when asked about the reaction of pension funds.

The consortium, composed of Metro Pacific holdings Inc., Pangilinan’s MIG holdings Inc., GT Capital holdings Inc. and Mit-pacific Infrastructure holdings Corp., has offered shareholders a price of P4.63 pesos per share. The tender offer price earned criticisms from investors who said the price was “very low.”

The tender offer price, the consortium said, takes into consideration the voluntary delisting rules of the PSE and represents a premium of 22 percent over the 12-months volumeweighted average trading price of MPIC on the PSE.

The consortium took back last week the said tender offer price.

From an MPIC perspective, Pangilinan said, the company’s share price has been undervalued for quite some time, and has been trading for a number of years at a low price of P5 per share.

“It is indeed a significant discount to the underlying value of the shares of Metro Pacific, we know that even as a company at our level,” he said.

“The market makes it sound judgment as to what level of share price it wishes to value the company at that level. And our difficulty has always been to be able to fund the expansion of the growth of MPIC.”

He said the company has not raised funds through equity due to its low price, “because we do not want to penalize the stockholders having to buy the share price at a steep discount.”

“So it does put a bit of a crimp on our ability to raise funding on the equity side of the business. And at the end of the day, the whole point about being a public company is to be able to raise funds from the public at a decent price to the existing shareholders,” Pangilinan said.

MPIC’S shares closed on Tuesday at P4.46 apiece.