Quick Take: Delisting rumors and 2 more market updates
Balai Ni Fruitas [BALAI 0.69 1.5%] [link] reallocated P40 million of its IPO proceeds from “store network expansion” to “commissary set-up”. This brings the amount set aside for the commissary to P60 million in total. The BALAI board said that it was able to expand distribution of BALAI’s product through placement in “Fruitas Holdings Community Stores and third-party partnerships”, and that by increasing the allocation to the commissary, the board will be able to “expand capacity and serve increasing demand.” The change increases the budget for the commissary by 200%, and reduces the budget for store expansion by 24%.
MB Quick Take: The Fruitas [FRUIT 1.28 1.5%] pivot toward life as a distribution platform was already underway when BALAI conducted its IPO, so it’s not like the community store or third-party partnerships angles were unknown at that time, but it seems like the group feels the opportunity cost of building more stores is too high relative to the benefits of having expanded capacity from the commissary to support the existing distribution demand. Seems like a good problem to have.
A Brown Company [BRN 0.80 6.7%] [link] disclosed that it has entered into a joint venture (JV) with GET Philippines to create, cooperate, and manage the ABC Electric Shuttle Service in Cagayan de Oro, initially with a fleet of 10 electric mini-buses. According to the disclosure, GET will incorporate the JV with P45 million in outstanding capital stock at P1.00/share, and then transfer 22.5 million shares (worth P22.5 million) to BRN in exchange for P22.5 million in cash. The result will be both parties owning 50% of the JV. GET describes itself as a “first mover” in “electric mass mobility as a service”.
MB Quick Take: This is not a huge deal in the grand scheme of things, but it’s the kind of modular test that we’ll either never hear about again, or that will provide BRN and GET with enough data to justify a large scale roll-out of the plan to other major city centers in the coming months/years. BRN is just looking to diversify its income streams by offering EV services amid an environment of high inflation and volatile fuel prices.
Metro Pacific [MPI 4.20 0.2%] rumors are still swirling of a plan between MPI, Mitsui, and GT Capital [GTCAP 512.50 1.4%] to take MPI private through some kind of tender offer process. MPI has 28.7 billion outstanding shares, with a relatively high 36.51% public float. MPI’s public float would need to be reduced to below 10% before the MPI/Mitsui/GTCAP group could delist and take the company private.
MB Quick Take: I haven’t been able to triangulate or confirm any of the info. No word yet on potential price or valuation for the shares, but the group would need to spend somewhere around P32 billion to acquire 7.6 billion common shares. That would be one hell of a tender offer.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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