ATR Kim-Eng to raise P200M

ATR Kim-Eng Financial Corp. (ATRKE) expects to raise about P200 million through a private placement and stock rights offering.

In a disclosure to the Philippine Stock Exchange (PSE), ATRKE Financial said the private placement is intended to facilitate the entry of a new shareholder group into the company.

ATRKE Financial said it issued to Oro Group Ventures and Harmony Investment Fund Ltd. 40 million shares at P2.60 each for a total of 104 million

Oro Harmonia is a joint venture between Oro Group Ventures and Harmony Investment Fund Ltd., an Asian special situations investment fund managed by Harmony Capital Partners Inc. of Singapore.

ATRKE Financial said the private placement will increase the company’s stockholders equity by P104 million in paid-up capital and the balance of P64 million in share premium.

To allow existing shareholders the same opportunity to invest in the company at the same price, ATRKE will undertake a stock rights offering to all shareholders of record of May 4, 2007. Selling shareholders are Asianlife Financial Assurance Corp., ATR Kim-Eng Capital Partners Inc. and the Retirement Plan.

Once these transactions are completed, ATR Holdings will maintain its shareholdings at 312.36 million shares but its percentage ownership will be slightly diluted from 47.87 percent to 45.11 percent. On the other hand, Kim-Eng Holdings will increase its shareholdings to 267.09 million shares and maintain its 38.57 percent ownership of the company.

Proceeds from the offering will be used for general working capital to expand the individual lending and insurance businesses which include providing mortgage financing and mortgage redemption insurance for buyers in ATR Kim-Eng Land’s property in Sucat, Paranaque.

The property will be developed into a mid-rise residential condominium complex via a joint venture with Landco Pacific Corp.

ATRKE Financial said other proceeds from the offering will be used to repay and reduce existing debt.

"This investment by Oro Harmonia in ATRKE Financial also secures a business alliance between our wholly-owned investment banking subsidiary, ATRKE Capital, and Harmony Capital Partners. In certain circumstances, Harmony can provide funding and strategic input for transactions originated by ATRKE Capital. The investment banking team at ATRKE Capital is excited by the prospect of enhancing their capital raising capability for their clients with the alliance afforded by the investment in ATRKE Financial by Harmony," said ATRKE Financial president Manuel N. Tordesillas.

Suresh Withana, managing director of Harmony Capital Partners said, "we have long felt that the Philippines presented an increasingly attractive investment opportunity. We believe ATRKE Financial is well poised to benefit from the increasing appetite for capital raising and financial advisory work from its client base. Equally, we are excited at the prospect of teaming up with a leading local investment bank to find appropriate investment opportunities for our fund."