Ayala Land sells P3.2-B worth of AREIT in block sale

Ayala Land [ALI 29.00, down 2.4%; 121% avgVol] [link] disclosed that it sold 98 million common shares of AREIT [AREIT 33.00, down 3.4%; 848% avgVol] in a private placement block sale at a price of P32.45/share. ALI said that the transaction was two times oversubscribed at the clearing price, which was 5% under AREIT’s closing price from the previous day. The transaction raised P3.18 billion for ALI and increased AREIT’s public float to facilitate the planned property-for-share swap between ALI and AREIT.

MB bottom-line: While I didn’t know exactly when this second block sale would happen, I did know that it was going to happen and I speculated back in January that it would probably come as a surprise and at a discounted price to AREIT’s market price at the time. Here’s a link to that analysis if you’re interested. At the end of the day, the first sale was at a 7.2% discount whereas this one was only at 5.0%, and the public float is now prepped to handle the SEC’s eventual approval of the transaction (whenever that happens) without plunging AREIT’s shareholders into chaos and confusion like what happened to SP New Energy [SPNEC 1.05, down 0.9%; 85% avgVol] when the SEC approved its share swap and caught Leandro Leviste’s management team flat-footed.

---

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.