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Stock Commentary

SEC batch-approves a bunch of offerings

Merkado Barkada
SEC batch-approves a bunch of offerings

On Friday, the SEC approved P40 billion in stock offerings and P50 billion in bond offerings for several projects slated to hit the market this quarter. The largest and most impactful of the bunch is the P28.85 billion follow-on offering by Synergy Grid [SGP 395.80 susp] to raise funds to buy non-voting preferred shares in NGCP and also meet its minimum public ownership requirement. 

The Keepers Holdings [KEEPR susp] is in a similar position, selling up to P7.5 billion worth of stock to get on the right side of the minimum public ownership threshold that it breached as a result of the share-swap transaction with Lucio Co’s COSCO Capital [COSCO 4.99 0.40%]. The SEC also approved the P4 billion worth of preferred shares that Megawide [MWIDE 6.28 0.48%] is hoping to sell, and the ?50 billion bond shelf-registration that Ayala Land [ALI 33.85 1.35%] is hoping to sell to refinance debt.


MB BOTTOM-LINE

This is going to sound weird to say, especially in the middle of a pandemic where thousands have lost their jobs and millions have probably had their earnings cut significantly by the COVID-ravaged economy, but there is a lot of money sloshing around in our system searching for returns.

Conveniently, there are also an awful lot of companies that, for various reasons, are interested in selling a part of themselves to get some of that money.

The PSE is also very interested in facilitating that transfer, both for the fees that it can extract from the transactions, but also for the optics of its own equity-raising scorecard.

Unlike the weird gate-keeping that the PSE pulled on Injap Sia’s MerryMart [MM 3.67 1.08%] last year (which it declined to repeat on Manny Villar’s AllDay Mart [ALLDY 0.80 pre-IPO]), I don’t expect much (or any) push-back from the PSE on these applications.

There’s going to be a lot of market action this quarter!

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Merkado Barkada is a free daily newsletter on the PSE, investing and business in the Philippines. You can subscribe to the newsletter or follow on Twitter to receive the full daily updates.

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.

AYALA LAND INC COSCO CAPITAL MEGAWIDE CONSTRUCTION CORP. PHILIPPINE STOCK EXCHANGE SYNERGY GRID
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