• Do offshore companies control Travellers Hotel?

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    Emeterio Sd. Perez

    Emeterio Sd. Perez

    OWNERSHIP PROFILE. Travellers International Hotel Group Inc. has five foreigner-owned corporate stockholders who, as a group, control a total of 14.16 billion common shares and 500,001 million preferred B shares.

    As Travellers International said in its disclosure, its five significant stockholders are Genting Philippines Holdings Ltd., 5.66 billion common shares, or 22 percent; Asian Travellers Ltd., 1.78 billion common shares; Premium Travellers Ltd., 1.04 billion common shares; Star Cruises Philippines Holdings B.V. and Star Cruises Investment Holdings Cooperative U.A., 2.83 billion common shares, or 11 percent, each.

    Only three of them hold preferred B shares, such as Genting, Star Cruises Philippines and Star Cruises Investment, with 1.67 billion preferred B shares, or 6.48 percent, each, for a total of 500 million.

    A regulatory filing listed “British Virgin Islands” as the nationalities of Genting, Asia Travellers and Premium Travellers. The two Star Cruises companies were identified only as “Netherlands” entities.

    Computations. Based on the website of the Philippine Stock Exchange (PSE), Travellers International Hotel Group has issued 25 billion common shares, which are all listed, of which 15.97 billion are outstanding. It also listed 40 percent as the limit to the ownership of common shares by foreigners.

    To determine if the hotel-cum-casino group is compliant with the 40-percent foreign ownership restriction, you divide 14.16 billion common shares held by five foreigner-owned corporate stockholders by 15.97 billion outstanding common shares and you come out with 88.68 percent, a percentage that exceeds the 40-percent limit by 48.68 percent.

    Even in its own filing dated November 5, 2013, Travellers favored foreigners. Of 1.81 billion common shares it sold through an initial public offering (IPO), 1.28 billion, or 71.02 percent, went to foreigners, and 524.26 million, or 28.98 percent, to Filipinos.

    Remedy. The creation of preferred shares is intended to correct the violation of 40-percent ownership ceiling. Thus, Travellers International Hotel Group issued 10 billion preferred B shares. The company’s disclosure in November showed the issuance of 8.33 billion preferred shares, or 83.33 percent of 10 billion preferred shares, to Filipinos and 1.667 billion, or 16.667 percent, to foreigners.

    In the same November PSE posting, Travellers International came out with a total of 17.35 billion common and preferred shares, or 66.82 percent, owned by Filipinos, and 8.61 billion common and preferred shares, or 33.18 percent, owned by foreigners. Its own computation makes it a Filipino-controlled company.

    But here is the puzzle: If in its November disclosure Filipinos owned 8.33 billion preferred shares and foreigners 1.68 billion, how come its December filing showed the control by five foreign companies of 5 billion preferred shares and 14.16 billion common shares. If you add them, you would arrive at a sum of 19.16 billion shares, or 73.79 percent of 25.97 billion outstanding capital stock consisting of 15.97 billion outstanding common shares and 10 billion outstanding preferred shares.

    Will the certified public accountants and lawyers of Travellers synchronize its filings so as not to confuse Due Diligencer, if not the entire public?

    Dividend payment. Globe Telecom Inc. will distribute cash dividends quarterly starting in the third quarter of 2014 and not in the first quarter as it announced in August, according to its posting on the website of the PSE.

    The Zobel-controlled telecom group has adopted a dividend policy “to declare cash dividends to its common stockholders on a regular basis as may be determined by the board.” It said “the dividend pay-out rate starting in 2006 is approximately 75 percent of prior year’s net income payable semi-annually in March and September each year.” Three years later, or on November 6, 2009, it raised the dividend to “75 percent to 90 percent of prior net year’s net income.”

    Then on November 8, 2011, Globe informed the public that the dividends were to be based “on core instead of reported net income” but maintained the pay-out range at 75 percent to 90 percent. It said “core net income excludes all foreign exchange, market-to-market gains and losses, as well as nonrecurring items.”

    As of September 31, 2013, Globe reported surplus of P6.85 billion,” which it said, is “available for dividend declaration.”

    esdperez@gmail.com

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    1 Comment

    1. Rwm in their prospectors b4 ipo has not mention any preferred shares, that makes me confused.should I keep my ipo shares and buy bloomberry instead? Pls advise me. Thks.