Republic Glass sells 2 subsidiaries to Asahi

The board of Republic Glass Holdings Corp. (RGHC) has approved the sellout of two subsidiaries – Republic Asahi Glass Corp. and Republic Asahi Realty Corp. – to Japanese partner Asahi Glass Co. Ltd. for roughly P1.2 billion.

In a statement to the Philippine Stock Exchange, RGHC said its board of directors had approved the sale to Asahi Glass of all the company’s shareholdings in the flagship glass firm RAGC while the realty company will be sold to local property firm Casa del Sol Development Corp.

Since the aggregate total revenue package for the sale is expected to reach P1.186 billion, RGHC said it issued and outstanding shares are each entitled to a gross proportionate participation of P1.74 per share in the proceeds of the sale.

"It is expected that the share purchase agreement for the transaction shall be executed within the next two weeks and that closing shall be done within two months thereafter," RGHC said.

RGHC, thru its flagship unit Republic Asahi Glass Corp., dominates the local market for glass products, supplying over 70 percent of the requirements for home and building construction.

Its tie-up with Asahi Glass started since 1988, when they put up a float glass plant in Batangas, becoming the country’s sole manufacturer and dominant supplier. The company has also expanded its market overseas, with exports to the US, Singapore and Indonesia, among others.

RGHC’s newly-elected board has given full power and authority to its chairman, former energy secretary Geronimo Z. Velasco and to vice chairman and president Geronimo Velasco Jr. "to negotiate terms and conditions of such a divestment and to submit the results of such negotiations to the board of consideration."

The Velascos, thru investment holding firm Gervel Inc., control 55.22 percent of RGHC. Other prominent investors in the company include retail king Henry Sy Sr., Bienvenido Tan Jr., Renato Ermita, Ma. Paz Amparo Laperal, Adeline Lim, and former National Power Corp. president Federico Puno.

At the PSE, shares of RGHC surged 49.47 percent yesterday – the biggest gainer for the day – adding 47 centavos to P1.42 each. The company has 737 million outstanding shares, out of which 31.78 percent are held by the foreign group.

In 1999, RGHC earned nearly P138 million while its retained earnings accumulated to P1.05 billion at yearend.