Omico doubles capital to P2B to fund projects

Listed mining and property firm Omico Corp. is doubling its capital stock to P2 billion to fund the acquisition of additional mining claims, exploration activities and real estate development projects.

Omico president and chief executive officer Tommy Tia said the company will undertake a stock rights offering to allow it to increase its capitalization which now stands at P1 billion. The firm, he said, is hoping to raise about P262 million from the proposed stock rights issue which was approved by its board of directors Tuesday.

Tia said shareholders can subscribe to one share for every three shares held as of a record date yet to be set by the company. The shares have a par value of one centavo.

Omico stocks closed at 1.9 centavos yesterday from 1.8 centavos last Monday.

As a sweetener, the company will give one free warrant for every two shares subscribed in the stock right and the grant of stock options to Omico’s deserving employees, officers and board members.

Tia said the increase in capital stock and the rights issue are still subject to the approval of the Securities and Exchange Commission and the Philippine Stock Exchange.

Rumors are afloat that the company is in talks with a Canadian-based mining firm to jointly conduct exploration activities at its copper mine in Benguet province.

Late last month, Tia sold 4.5 billion shares in Omico through a special block sale valued at P58.5 million.

Tia said the company continues to focus on mining and property development to improve its cash flow.

Late last year, Omico signed a joint venture agreement with Robinsons Homes Inc., for the development of the former’s 9,372-square-meter property in Tagaytay into a high density residential subdivision consisting of five-story residential condominium buildings.

Robinsons Homes is the developer of the project while Omico is the landowner. Robinsons Homes is the housing development division of Robinsons Land Corp., the property arm of the Gokongwei group of companies.

Omico’s first foray into housing development is its Santa Rosa Homes housing project in Nueva Ecija. The project covers 14 hectares of land and will consist of 1,071 housing units with a mixture of single-detached, single attached, duplex and row houses.

The company expects to generate between P120 million and P150 million from the sale of housing units.

The move is in line with the mining firm’s objective of rearranging its asset structure and converting its real estate investments into cash while considering opportunities outside of the property sector.

Another real estate project of the company is a joint venture with Sta. Lucia Realty & Development Inc., Asian Pacific Estates Development Corp. and Asian Empire Corp. The project involves the development of its 23.25-hectare property in Urdaneta, Pangasinan into a residential and/or commercial subdivision.

Profits to be generated from the venture will be used by Omico to pursue its mining ventures especially with the renewed interest in the sector following a ruling issued by the Supreme Court allowing foreigners to own up to 100 percent of local mining projects.

The company has real estate properties in Baguio, Tagaytay, Cabanatuan, Makati and Nueva Ecija.