July 31, 2011, Manila Bulletin
By creating four billion new preferred voting shares, JG Summit has raised its public float in the stock market to about 40 percent from 10 percent, according to JGS senior vice president for corporate planning and chief strategist Bach Johann Sebastian.
The Securities and Exchange Commission (SEC) has approved the increase in the authorized capital of JG Summit Holdings Inc. to pave the way for the creation of 4 billion preferred voting shares.
In a disclosure to the Philippine Stock Exchange, JG Summit corporate secretary Rosalinda Rivera said the SEC has approved the firm’s capital increase to P14.89 billion from P14.85 billion.
The increase is by way of the creation of 4 billion preferred voting shares with a par value of one centavo each. JG Summit’s capital also consists of 12.85 billion common shares and 2 billion non-voting preferred shares with a par value of one peso each.
The increase in capital and creation of the voting preferred shares were approved by JG Summit shareholders last January. The move is usually to allow the firm to sell more common shares to foreign investors.
Also earlier this year, JG Summit sold shares worth about P40 billion to partially fund its 2011 to 2013 capital expenditure of $700 million and raise its public float by another 25 percent.
The firm obtained its shareholders’ approval for the issuance of 2.09 billion shares to principal shareholders who will also be selling the same amount of shares at the same price to institutional investors.
JG Summit president Lance Gokongwei said the proceeds from the stock sale will be used for its equity contribution for a $700-million naphta cracker plant related to its petrochemical business.
The naptha plant, located in Sto. Tomas, Batangas, will produce polymer-grade ethylene and propylene, pyrolysis gas and by-products such as fuel gas, fuel oil and acid gas at an annual capacity of 925,537 metric tons. It is slated for completion in 2013.
About $120 million to $150 million was also allotted for JG Summit’s subscription to the stock rights offering of property arm Robinsons Land Corporation.
Gokongwei said the company also planned to pay off syndicated loans starting’ this year. Part of the proceeds may also be used for other projects, including its planned venture into infrastructure through the public-private partnership (PPP) scheme of the government.