DoubleDragon to kick off MerryMart tender offer

MANILA, Philippines — DoubleDragon Corp., the listed company owned by Edgar “Injap” Sia II and Tony Tan Caktiong, will start next week a mandatory tender offer to shareholders of MerryMart Consumer Corp.

The tender offer period, which will run from May 18 to June 16, will be at P0.48 per MerryMart common share, payable 50 percent in cash and 50 percent in DoubleDragon common shares valued at P9.30 per share.

The P9.30 per share value to be paid to MerryMart shareholders is about 52 percent lower than DoubleDragon’s latest available book value at P19.21 per share.

Meanwhile, the tender offer at P0.48 per share is 20 percent above MerryMart’s trading price of P0.40 per share as of May 8.

DoubleDragon last year announced its entry into the essential retail space with the acquisition of a 35-percent stake in MerryMart, a company owned by Sia, at P0.48 per share.

The company is required to conduct a mandatory tender offer of the shares of MerryMart held by its remaining shareholders at the same valuation, subject to final regulatory approvals.

The Philippine Competition Commission has already cleared the proposed acquisition.

After the acquisition, MerryMart will become directly part of the DoubleDragon Group.

The acquisition of MerryMart will complement the company’s investment-holding business.

MerryMart generates over P7 billion recurring revenues annually, mainly from essential retail such as grocery and pharmacy, as well as other consumer-related businesses.

“Given MerryMart Group’s various formats in retail and wholesale, as well as its pharmacy subsidiaries, which are major pharmacy players in Quezon-Luzon and Zamboanga-Mindanao, and its dominant grocery business in Capiz province, the acquisition of the MerryMart Group is expected to create long-term value and synergy to DoubleDragon Group,” DoubleDragon said.