Calata loses ‘white knight,’ faces delisting
posted October 24, 2017 at 10:09 pm by Jenniffer B. Austria
http://manilastandard.net/business/business-stocks/250218/calata-loses-white-knight-faces-delisting.html
Millennium Global Holdings Inc. said Tuesday it canceled plans to take over problematic agriculture company Calata Corp.
The move will leave Calata without a ‘white knight’ that could save the company from possible delisting from the Philippine Stock Exchange.
MG said in a disclosure to the stock exchange its board ruled with finality that it would no longer proceed with the planned acquisition of 81 percent of Calata.
“The company shall instead tap its other business opportunities and areas of growth to fortify its business within the country and abroad,” MG said.
“With a firm handshake, the company conveys its gratitude to Calata for having been given the opportunity to do business with the latter,” it said.
Calata earlier agreed to sell an 81-percent stake to MG and spin off its assets to a privately held firm.
PSE last month initiated delisting procedures against Calata for allegedly committing multiple violations of the disclosure rules.
PSE president Ramon Monzon also thumbed down the rescue deal proposed by Calata.
Monzon said Calata’s proposal involved many uncertain things including getting the approval from the Securities and Exchange Commission on the proposed increase in authorized capital stock to facilitate the entry of MG.
Calata also needed to secure shareholders’ approval for the planned spinoff of its assets and the sale of 81-percent stake to MG.
MG earlier said it planned to use Calata to acquire the business of subsidiary Millennium Ocean Star Corp., a leading exporter and importer of seafood and aquaculture products in the local and international market.
Monzon said PSE offered to allow Calata to conduct voluntary delisting instead of involuntary delisting on the condition that it would conduct a tender offer to small shareholders.
The proposal was also rejected by Calata, saying a tender offer could “kill the company” because it had no sufficient retained earnings to fund the tender offer.
Calata said it had only P400 million in retained earnings and would need at least P1 billion to finance the tender offer. |
