UEM Development in voluntary suspension of trading

MANILA, Philippines - The Philippine Stock Exchange has implemented starting yesterday a trading suspension on shares of UEM Development Corp., controlled by Henry Sy Jr., the eldest son and namesake of the country’s wealthiest man.

This was in lieu of UEM’s request for immediate voluntary suspension of the trading of its shares until such time it obtains the approval of the Securities and Exchange Commission for an increase in its capital stock from P50 million to P215 million.

Sy is the chairman and president of UEM, holding 47.07 percent of the company’s outstanding capital stock.

UEM, which will be renamed Synergy Grid & Development Philippines Inc., will issue 100 million common shares at P140 per share in exchange for all outstanding shares of One Taipan Holdings Inc. and Pacifica21 Holdings Inc., both owning 30 percent plus one share each in power transmission operator National Grid Corp. of the Philippines (NGCP).

The shares to be issued will come from UEM’s capital hike.

OneTaipan controls Monte Oro Grid Resources Corp. while Pacifica21 holds controlling shares in Calaca High Power Corp. led by businessman/stockbroker Robert Coyiuto.

Aside from the share swap, which is subject to the SEC’s approval, UEM plans to issue 65 million worth of non-voting preferred shares to be sold through a public offering, scheduled next year.

UEM said proceeds from the preferred share offering will be used to refinance outstanding group debts and fund corporate requirements.

Sy, through his company One Taipan, acquired in March the 30-percent stake of Monte Oro Resources in NGCP for $350 million.

He is also currently the vice chairman and CEO of SM Development Corp. and vice chairman of SM Investments Corp., which owns the largest Philippine bank by assets, the nation’s biggest shopping mall operator and the number one department store and grocery chain.

Sy plans to use UEM as corporate vehicle to carry out big-ticket infrastructure and public utilities projects. The government is inviting the private sector to invest in P200 billion worth of state infrastructure projects.

Founded in 1970, UEM was formerly known as Mankayan Minerals Development Co. Inc. before it changed its name to UEM Development in February 1994. It renders consultancy and advisory services, particularly for construction projects.