Landbank plans lower price offer for PDS shares

State-run Land Bank of the Philippines plans to lower the price it is offering for the purchase of Philippine Dealing System Holding Corp.’s (PDSHC) shares, a top official of the bank said.

In an interview, Landbank president and chief executive officer Alex Buenaventura said the bank would adjust the P360 price per share it offered to PDSHC shareholders in light of the dividends recently declared by the fixed-income bourse.

Buenaventura said the remittance of dividends lowered the company’s net asset value, which was the basis for the share purchase price.

“When you make an offer, it’s based on the net asset value of the PDS. We made the P360 offer to buy based on the net asset value prior to their declaration of the dividends,” Buenaventura said.

“But (the net asset value) moved, they declared dividends...so our response will be most likely lower than P360,” he added.

Buenaventura said, Landbank is now conducting due diligence to determine the revised value of the purchase.

He said the bank hopes to finish its due diligence soon and send its response to the shareholders who accepted Landbank’s purchase offer by the end of next week.

“Hopefully, by the end of next week. It will be our response to their acceptance letter,” Buenaventura said.

Earlier, the Landbank chief said some PDSHC shareholders, with combined shares of 43 percent, have already expressed their intent to sell their stake in the trading platform.

He said the bank is still aiming to acquire at least 66.67 percent of PDSHC shares. Other shareholders are still on a waitand-see stance, he added.

Currently, PDSHC has a total outstanding shares of 6.25 million, with the PSE owning 20.98 percent, the Singapore Exchange Ltd. at 20 percent, the Bankers Association of the Philippines (BAP) – for itself and as trustee of its member-banks – at 13.26 percent, BAP – other member-banks – at 9.78 percent, Tata Consultancy Services Asia-Pacific Pte. Ltd. at eight percent, among others.

Landbank, for its part, owns 1.56 percent of the company through the BAP. If it successfully acquires at least 66.67 percent of the fixed income bourse, its stake would increase to 68.23 percent.

Buenaventura earlier said acquiring majority control of PDSHC would help strengthen the financial position of the bank and contribute to the development of the domestic capital market.

He said the majority control of the PDSHC would allow the small and medium enterprises as well as other sectors to raise money through securities.