The board of bottler Pepsi-Cola Products Philippines Inc. decided to delist the company from the Philippine Stock Exchange (PSE), as the company will not be able to comply with the minimum public float rule given the uncertainty in the market.
In a disclosure, the company said its South Korean parent Lotte Chilsung Beverage Co. Ltd. will start its tender offer procedure to acquire up to 77.85 million common shares held by all shareholders of the company. The said tender offer does not include those shares being held by majority owners Lotte Chilsung, Lotte Corp. and Quaker Global Investments B.V., a wholly-owned unit of PepsiCo Inc.
Lotte Chilsung last year began its tender offer for the shares of Pepsi Philippines that it still does not own, or about 2.13 billion common shares equivalent to 57.78 percent of the company, for P1.95 apiece.
It has previously asked for an exemptive relief from the Securities and Exchange Commission (SEC) and the PSE since it has no plans of delisting the company from the local bourse.
The Korean company said it has no plans that would result in any merger, reorganization or liquidation of the company, or that would result in a material change to the company’s corporate structure or business.
Lotte Corp. already owns at least 42.22 percent of the company.
As a result of the buyout, Pepsi-Cola Philippines’s public float dwindled to 2.11 percent, or below the 10 percent minimum public ownership requirement.
“Under the PSE Rule on Minimum Public Ownership, the company has until 18 December 2020 to comply with the 10-percent minimum public float requirement or otherwise be subject to involuntary delisting,” the company said.
“After due evaluation and study of the options available to the company, the board of directors approved and authorized the voluntary delisting of the company’s shares from the PSE. Considering the level of its public ownership and the prevailing market conditions, it will not be able to comply with the minimum public ownership requirement by 18 December 2020,” it added.
The company’s shares were suspended for trading since June and closed at P1.70 per share on June 17.
Pepsi-Cola Philippines was incorporated on March 8, 1989, primarily as a local bottler of the products of PepsiCo. It went public on February 1, 2008.
In August 2014, the SEC approved the amendment of its primary purpose to also engage in the manufacturing, sale and distribution of snacks, food and food products. It initially manufactured its Cheetos brand in the country but later on halted local production.
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