SEC urges firms with P50-M in assets to go public

The Securities and Exchange Commission is urging SEC-registered corporations with P50 million in assets and at least 100 stockholders to go public in line with the regulator’s efforts to promote more initial public offerings at the local bourse.

SEC chairperson Lilia R. Bautista said that out of the 200,000 corporations registered with the agency, only 237 are listed. And of the 237 listed firms, only 100 are actively traded, Bautista said.

"Investors should have more choices. There isn’t enough number of shares listed at the PSE. If we want more investor participation, then we must broaden the quality and quantity of stocks traded at the PSE," Bautista said.

The SEC is likewise urging the country’s top 5,000 corporations to list their shares at the bourse to provide the public with more investment choices.

Bautista has also encouraged entities registered with the Board of Investments (BOI) to open up their ownership to the public to enable them to expand their capital base and finance capital expenditures. She said subsidiaries of companies that enjoy incentives from the BOI should also be included.

After a relatively lean IPO market, the PSE is hoping to attract more companies – from SMEs to giant multinationals – to list their shares and provide the impetus for a long-awaited stock market rally by next year.

From big-ticket items that include the likes of oil firms Shell and Caltex, energy companies PNOC and Mirant, and pharmaceutical leaders United Laboratories and Mercury Drug, the PSE is also in active discussions with small and medium enterprises, which seemed more eager to offer their stocks to the public.

Only five companies have made their IPOs this year: Salcon Power, Highlands Prime, Banco de Oro and Jolliville Holdings, and Makati Finance Corp.

PSE Chairman Vivian Yuchengco said although it would be quite difficult to attract companies to go public at a time when the stock market is on a slump, an early move on their part would be beneficial on the long-term for both the company and its investors as the equities market recovers and brings about increase in shareholder value.

Earlier, the PSE also indicated plans to tap companies located in the country’s economic zones. Out of about 1,000 ecozone locators located in the country’s 85 accredited ecozones, less than a handful are listed – Ionics Corp., SPI Technologies and Active Alliance.

But foreign chambers seemed uneasy with the proposal particularly as this would open up their businesses to a host of additional regulatory requirements on top of what the Philippine Economic Zone Authority requires.

Nearly 80 percent of the ecozone companies are foreign-owned or controlled, most of them from Japan, the US, United Kingdom, Taiwan, Singapore, Malaysia and other Asian countries.