Firms not complying with minimum float rule down to 27

MANILA, Philippines - The number of listed corporations that fall below the required minimum public float of 10 percent has been trimmed to 27 as of end-June 2012 from 42 last year, based on the list submitted by the Philippine Stock Exchange to the Securities and Exchange Commission.

Among the companies that have yet to boost their public ownership are Allied Banking Corp., First Metro Investment corp., Maybank ATR King Eng Financial, SPC Power, Vivant, Alaska Milk, Cosmos Bottling, San Miguel Pure Foods Co., San Miguel Brewery, Lafarge Republic, Manchester International Holdings Unlimited, Mariwasa Siam Holdings, Integrated Micro-Electronics, Alphaland, Filinvest Development, F&J Prince Holdings,

Synergy Grid & Development, Eton Properties Philippines, Sta. Lucia Land, San Miguel Properties   2Go Group, PAL Holdings, Metro Pacific Tollways, JTH Davies, Globalport 900, Atok-Big Wedge Co. and PNOC-EC.

Non-compliant companies have until Dec. 31 this year to meet the 10-percent minimum public ownership requirement for continued listing on the stock exchange.

Failure to do so will result in the suspension of trading in their shares for up to six months beginning the first trading day next year.

Once trading is suspended, any transaction on stock trades will no longer enjoy the preferential tax rate of 0.5 percent. The Bureau of Internal Revenue will instead slap the five-to 10-percent capital gains tax on stock trades.

Aside from this, companies must still pay listing fees while they are suspended.

After the lapse of the suspension period, they will automatically be delisted from the local bourse, unless they have by then complied with the requirement.

Alaska Milk Corp. whose public float currently stands at 2.28 percent has already indicated its intention to delist its shares from the bourse after being taken over by Dutch firm dairy giant Royal Friesland.

San Miguel Brewery, Metro Pacific Tollways and Eton Philippines earlier said they were considering delisting from the PSE and would announce final plans once they are in place.

PSE president Hans Sicat remains confident a big chunk of these erring companies would comply with the requirement, noting that most of them have indicated plans to do a private placement or a follow-on offering.

The minimum public float rule was intended to provide a fair and efficient facility for price discovery and ensure that sufficient liquidity exists.

Securities exchanges in Hong Kong, Singapore and Thailand already impose minimum float requirements of between 10 percent and 25 percent.