SM unit extends tender offer period

MANILA, Philippines - The landholding unit of mall and banking conglomerate SM Investments Corp. (SMIC) has sought for more time to buy out minority shareholders of two property units.

The application of SM Land Inc. for an extended tender offer is in line with the P279-billion merger of SM’s property units.

The Securities and Exchange Commission (SEC) said it approved the petition of SM Land to extend the tender offer of SM Development Corp. (SMDC) and Highlands Prime Inc. (HPI) to Aug. 2 from the original deadline of July 9.

The request was made “to give more time to SMDC shareholders to tender their common shares,” SEC said.

SM Land plans to acquire 34.82 percent or 3.228 million shares of SMDC and 100 percent or 2.246 million shares of HPI through a tender offer that started on June 4.

“During the conduct of the tender offer, SM Land received reports through BDO Securities Inc. that there are certain shareholders who are or will be unable to comply with certain documentary requirements for the tender offer within the aforementioned period,” SMIC said.

As of June 24, only 11.45 percent and 66.22-percent common shares of SMDC and HPI were bought from minority stockholders, respectively.

Late in May, SMIC announced the merger of its real estate businesses, creating the most valuable property firm in the Philippines.

The transaction involves several steps. First, private firm SM Land will acquire upscale Tagaytay Highlands developer HPI and residential builder SMDC in exchange for shares in mall operator SM Prime Holdings Inc.

SM Land will then merge with SM Prime, which will be the surviving entity. SM Prime will also acquire specific real estate companies and assets currently held by SMIC like the SM Mall of Asia complex, Pico de Loro and SM Hotels and Conventions Corp.

The transformed SM Prime will have P284 billion in current assets from P148 billion, revenues of P58.4 billion from P30.7 billion, net income of P17 billion from P10.9 billion and total landbank of 920 hectares from 110 hectares.

After the consolidation, the main operating units of SM Prime will focus on malls, residential, commercial, hospitality and leisure, and lifestyle cities that will focus on large mixed-use developments.