Chemrez Technologies Inc. will be compelled to delist from the Philippine Stock Exchange (PSE) if it no longer complies with the minimum public float requirement of the bourse once its parent firm D&L Industries Inc. completes full acquisition of the listed oleo-fats manufacturer.
In a statement e-mailed to media on Saturday, Chemrez Technologies said the delisting will be pushed if the 10 percent minimum public ownership is not met after D&L’s full acquisition of the company via tender offer. It will then await the PSE’s mandate to involuntarily delist the company.
“This offer provides the final attractive opportunity for the remaining minority shareholders to fully realize their profits. Should the company elect to delist and have its shares no longer traded on the PSE, the ability to quickly liquidate the shares may be diminished in the absence of a healthy marketplace. Delisting would certainly reduce the shares’ marketability,” said Alvin Lao, Chemrez treasurer and D&L chief finance officer.
“Also, trading of shares of a private company entails higher taxes as capital gains tax and documentary stamp tax on every sale, barter, exchange or other disposition of shares of Chemrez shall be imposed,” he added.
Chemrez Technologies noted that there is no intention to turn the company into a listed shell entity.
The tender offer is currently on its run from September 4 to October 3. The offer price is at P6 per share, which is 24 percent above the 60-day moving average of Chemrez Technologies’ share price as of August 29.
D&L Industries, through the tender offer, would own the rest of the 65.3-percent stake in Chemrez Technologies, on top of its current 34.7 percent holdings in the company.
Chemrez Technologies is a listed manufacturer of resins, oleochemicals, and specialty products and has experience in technologies including: colorants, polymers, biopetroleum, oleochemicals, powder coating, food, oil and gas, and water treatment, among others.
D&L’s first half net income rose 22 percent to P799 million from P655 million, while revenues grew 26 percent to P6.2 billion from P4.9 billion last year.
Established in 1963 and listed in December 2012, D&L has four main businesses: food raw materials (Oleo Fats Inc), plastics (D&L Polymer and Colours Inc. and First in Colours Inc.), aerosols (Aero-Pack Industries Inc.), and chemicals (Chemrez Technologies).