Uy mulls sale of 2GO stake

MANILA, Philippines — The share price of shipping and logistics company 2GO Group Inc. sizzled the past days on market talk that a new investor is coming and that some shareholders are considering selling their stake.

Sought for comment on this, Davao-based businessman Dennis Uy, chairman of 2GO, said a sale of his stake is indeed possible but declined to elaborate.

“There have been offers to buy and as in any business, we can consider selling,” Uy told The STAR yesterday.

Uy’s Chelsea Logistics and SM Investments Corp. (SMIC), the investment holding firm of the Sy family, are majority shareholders of the 2GO Group after successfully taking control of the logistics firm previously led by the Tagud family.

The company is jointly led by Uy and the SM Group, with Uy as chairman and Francis Chua as vice chairman and independent director.

Its management is led by SMIC president and CEO Frederic DyBuncio.

2GO sizzled yesterday, with its shares up 18.18 percent to P10.92 per share.

Asked by the Philippine Stock Exchange about the unusual price movement, 2GO director Elmer Serrano told the local bourse that the company is not aware of any disclosed information that could have triggered the unusual price movement.

Market investors are speculating that Uy will sell his stake in the company to SMIC or that one of the two groups will sell their respective stakes to a foreign investor.

Two reliable sources said there has been no offer from the SM Group to buy Uy’s stake in the company.

Another source in the banking industry said another company is being enticed to come in but the particular group, a listed firm, is not interested in the passenger shipping business.

It was in 2016 when Uy made his entry in 2GO to ride on the lucrative and increasingly popular logistics industry. At the time, Uy’s Udenna Investments announced its entry in 2GO through the acquisition of a 32 percent stake in Netherlands-based KGL Investment B.V., which owns about 60 percent of KGLI-NM, which in turn controls Negros Navigation Co. Inc. or Nenaco. Nenaco owns 88.31 percent of 2GO.

The SM Group also acquired a 34.5 percent stake in Nenaco at the time.

The 2GO Group is the largest logistics provider in the Philippines with links to over 150 countries.

2GO was formerly owned by the Aboitiz Group.

The company has been facing a difficult tide the past years and is expected to even face dimmer prospects given the negative impact of the coronavirus disease 2019 or COVID-19 on the shipping business.

As of the end of September 2019, 2GO posted a net loss of P759 million, up from the P703 million loss in the same period a year ago.

In 2018, the net loss was P1.3 billion compared to only P315.7 million the previous year.