Lim family to hike stake in Solid Group

The family of businesswoman Elena Lim will increase its stake in publicly-listed Solid Group Inc. (SGI) as a result of a share-swap with its affiliate multi-media Destiny Group, SGI informed the Philippine Stock Exchange.

The swap, which was recently approved by SGI’s stockholders, will be carried out through the issuance of an additional 1.026 billion common shares worth about P215 million to the Lim family and other officers of SGI in exchange for shares of stocks of Destiny Cable Inc. and Destiny Inc.

In effect, the Lim family will increase its shareholdings in SGI from 68.5 percent to 79 percent. At the same time, the proportion of the public float and the Treasury shares in SGI’s capital structure will both be diluted to 14.1 percent and 6.85 percent, respectively, from their pre-swap holdings of 21.2 percent and 10.3 percent.

With the acquisition, the Destiny Group will be restructured so that the broadband cable infrastructure assets will be owned by Destiny Inc. and the franchise to operate cable facilities and the assets directly necessary for the franchise will be retained by Destiny Cable. Destiny Inc., which will become a wholly-owned subsidiary of SGI, will thereafter lease its facilities to Destiny Cable.

SGI, in turn, will invest in bonds or warrants of the holding company, which will be convertible to 100 percent of the issued capital stock of Destiny Cable.

SGI, formerly known as United Paracale Mining Co., is primarily engaged in the manufacture, distribution, and export of consumer electronic products. It operates production facilities for the manufacture of TV, video, and audio under the Sony and Aiwa labels.

But last year, its wholly-owned subsidiary Kita Corp., whose principal customer is Japan’s Aiwa Co. Ltd., suspended its manufacturing operations at the Clark Economic Zone due to the lack of production orders.

The Destiny Group, is engaged in the multimedia business. In June 1996, DCI obtained a 25-year franchise from the government to engage in cable TV, data and other businesses like high-speed Internet and leased line services, cable telephony, VSAT services, broadcast uplink and programming services.