MELCO SHARES TRADING HALTED AFTER PUBLIC OWNERSHIP FALLS BELOW MINIMUM

The Philippine Stock Exchange (PSE) suspended the trading of City of Dreams Manila operator Melco Resorts and Entertainment Philippines (MRP) on Monday as the company’s public float fell below the minimum level required for continuing listing.

Shares of MRP, a unit of Macau casino giant Melco, were suspended indefinitely starting 3: 21 p. m. yesterday as a recent tender offer to minority shareholders left only 3.9 percent of the company’s shares in public hands. The tendered shares were crossed on the PSE yesterday, triggering the suspension.

Despite the brouhaha over the valuation of the tender offer, a total of 1.338 billion common shares were tendered, allowing the principal shareholders of MRP—MCO Investments and affiliates—to control 96.1 percent of the company’s total shares.

Before the tender offer, 27.23 percent of the company’s outstanding capital was held by the public.

The PSE requires a public float of at least 10 percent to remain listed on its bourse. Citing its amended listing rules, the PSE said that should MRP remain noncompliant with the minimum public ownership requirement, “MRP shall be automatically delisted from the official registry of the exchange no later than six months thereafter.”

This suggests that MRP would be able to execute its plan to delist from the PSE, albeit on an involuntary basis.

MRP’s plan to voluntarily delist from the PSE was previously derailed by complaints on the tender offer pricing.

An involuntary delisting from the PSE means that the members of MRP’s board of directors will be banned from joining the board of other companies listed on the bourse for the next five years.