THE Philippine Stock Exchange Inc. (PSE) is still clinging to its hopes of getting regulators to approve its plan to merge with PDS Holdings Inc. before the year ends.
The PSE is also rushing to comply with the ownership cap of stock brokers to get the nod of the Securities and Exchange Commission (SEC).
“We can only hope it happens during the first quarter of next year. I don’t know if you will be more optimistic,” PSE Chairman Jose Pardo said. “I’ve tempered my optimism when it will finally happen.”
PSE’s optimism of regulatory approval comes after the Philippine Competition Commission (PCC) in late-November approved the PSE’s proposed merger with the PDS, the owner of the fixed-income bourse operator Philippine Dealing and Exchange Corp.
The PCC’s approval, however, focused on the so-called efficiencies when the equities and fixed-income exchanges are owned by a single entity.
The SEC’s approval, on the other hand, will focus, among others, on PSE’s request for “exemptive” relief on the 20-percent industry ownership limit and, in this case, the stock brokers.
“I always like to put myself out on a limb. I’d like to think it will happen before the end of the year,” PSE President and CEO Ramon Monzon said. “I hope it will happen before the end of the year.”
Monzon said the PSE already filed a registration statement with the SEC for its stock-rights offer of 11.5 million shares, aimed at diluting the combined ownership of brokers to pull it down to 20 percent, from the current 23 percent.
“The offering will not be open to the stockbrokers so that there will be a forced dilution of the stockbrokers,” he said. “In our computation, with the 11.5 million shares that we will be offering, we believe that the final ownership of the brokers of the PSE will be a little less than 20 percent.”