Ongpin group acquires Lorenzo firm

MANILA, Philippines - The group of former Trade and Industry Minister Roberto V. Ongpin and UK-based investment fund Ashmore Group is acquiring from the Lorenzo family a 66- percent stake in listed firm Macondray Plastics Inc. for P218.78 million.

The deal is the second transaction sealed by the Ongpin-Ashmore Group this week following the purchase of a controlling stake in shell mining firm Atok-Big Wedge Co. Inc.

In a disclosure to the Philippine Stock Exchange, Macondray Plastics said its majority shareholder Macondray & Co. Inc. (MCI) signed an agreement with RVO Capital Ventures Corp. whereby the latter shall acquire MCI’s 66-percent stake or 99.44 million shares in Macondray Plastics for P2.20 each share or at a 10-percent premium on the 90-day trading average of the closing price of the company’s shares in the exchange.

Regina Santos, corporate information officer of Macondray Plastics, said the offer price also represents a 25-percent premium on the company’s net book value as of end-August 2009 of P1.76 each share.

The consideration will be paid in cash upon approval by regulatory authorities of the sale.

RVO Capital is a holding company beneficially owned and controlled by Ongpin and Eric O. Recto, who represent the Ashmore Group in the Philippines.

As the acquisition involves more than 35 percent of the company, RVO Capital will make a tender offer for all the remaining shares of Macondray Plastics under the same terms and conditions of the agreement.

As soon as the Ongpin-Ashmore camp comes in, Macondray’s operations will be spun off into a wholly-owned subsidiary to be called Macondray Plastics Products Inc. to allow the group to venture into other profitable businesses such as real estate development.

The Ongpin-Ashmore Group owns the Alphaland Southgate tower, which was acquired from the Puyat family for P1.3 billion in early 2008. It also owns a lot on Ayala Avenue in Makati City where it is building the Ashmore Ayala Tower.

Aside from this, the group earlier forged an agreement with the Boy Scouts of the Philippines to develop the Sime Darby property, also on Ayala, into a mixed-use complex.

Incorporated in 1990, Macondray Plastics produces varied polyolefin plastic blown film products, polyethylene foam net products, and polypropylene twine for the plastic packaging requirements of the agricultural sector in the Philippines.

It also serves the requirements of customers for commercial/industrial applications. These are requirements from manufacturers and producers outside the banana industry and cover the range of varied food packaging products, such as fresh tuna export bags, packaging for desiccated coconut, packaging for export banana chips and fresh poultry products.

Santos said proceeds from the sale will be used by the Lorenzo Group to seize growth opportunities. “This transaction will provide MCI the financial flexibility to look at other investment opportunities which are currently not within our core businesses,” she said.

In the first half this year, Macondray Plastics registered a 17 percent jump in sales to 2,280 metric tons from only 1,947 MT in the same period a year ago.

Just last Monday, the Ongpin-Ashmore group, through Boerstar Corp., announced that it was acquiring at least 80 percent of Atok-Big Wedge as part of a strategy to further build up its investment portfolio, which includes Philex Mining Corp., oil refiner Petron Corp., San Miguel Corp., PhilWeb and ISM.