The price of Ferronoux Holdings Inc. shares surged 49.53 percent to hit its intraday ceiling of ₱8 per share after the suspension in the trading of the stock was lifted by the Philippine Stock Exchange (PSE).
The suspension was lifted after the firm submitted its comprehensive disclosure regarding transactions that will result in the backdoor listing of Themist Group Corporation.
The PSE suspended trading of Ferronoux shares on Dec. 19, 2024, after it disclosed a share-for-property swap with Themis' subsidiary Eagle 1 that will give Themis a controlling stake in the company.
"The surge in stock price was expected due to speculation on the market value and development potential of the parcels of land to be infused," said Chinabank Capital Corporation Managing Director Juan Paolo Colet.
He added that, "There is also the possibility that Eagle 1 will infuse its much larger properties that are currently leased to Okada Manila."
According to its latest disclosure, Ferronoux said Themis will conduct a mandatory tender offer for all the 128.29 million Ferronoux shares held by public shareholders but did not disclose the tender offer price.
Ferronoux shares last traded at ₱5.35 per share on Dec. 18, 2024, prior to the trading suspension. Before this, Themis had subscribed to Ferronoux shares at just the par value of one peso per share, but the property-for-share swap has been priced at ₱4.70 per share.
However, since the market price is now ₱8 a share, Themis will have to decide how to price the tender offer to make it attractive to minority shareholders if it wants to buy those shares.
Ferronoux said it also plans to conduct a follow-on offering, as required by the PSE’s backdoor listing rules, within one year after completing the property-for-share swap with Eagle 1 of Themis.
Themis is subscribing to Ferronoux shares in exchange for a ₱4.31 billion prime property beside Okada Manila.
Ferronoux announced that it will raise its authorized capital stock to ₱2.5 billion from ₱550 million with a par value of one peso per share to issue 1.458 billion new shares.
The issuance is equivalent to 74.39 percent of the firm’s expanded capital (once approved by the Securities and Exchange Commission). It currently has an outstanding capital of only 261 million shares.
Including the earlier Themis subscription to 240 million Ferronoux shares from its existing capital stock, the firm will be issuing 1.7 billion shares, amounting to 86.63 percent of its expanded capital.
Ferronoux said Themis is subscribing to an additional 240 million common shares to be issued from the increase in capital stock at a par value of ₱1 per share or a total amount of ₱240 million to be paid in cash or property.
In the property-for-share swap, Ferronoux will also issue 918 million common shares at ₱4.70 per share or a total amount of ₱4.31 billion out of an increase in the capital stock by the company in exchange for three parcels of land owned by Eagle 1 Landholdings Inc.
Eagle 1 lists Abel M. Almario as its director and vice president and Philipe T. Aquino as corporate secretary. Both lawyers were elected as directors of Ferronoux after the first 240 million share subscription by Themis.
The property is situated in Brgy. Tambo, Parañaque City, with a total area of 94,144 square meters adjacent to the Okada Integrated Casino Resort. A portion of the property is being used to house the support facilities of the Okada casino complex but will eventually be vacated once construction of the master-planned development commences.
Ferronoux and Eagle 1 intend to jointly develop the property to realize its full potential value through the company’s resources, including, but not limited to, the ability to raise funds from the public.
The firm is also issuing, via private placement, 300 million shares out of the increase in capital stock (15.3 percent of expanded capital) to comply with the minimum public ownership requirement considering the additional subscription of Themis and the property for share swap with Eagle 1 which will reduce the public float of the company’s stock.
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