SM Investments ready to take public shares in 2GO for P5.55 billion

SY-LED SM Investments Corp. has set aside about P5.55 billion to fully accept shares in 2GO Group, Inc. in a tender offer that will begin on March 15, both companies disclosed to the stock market on Monday.

The tender offer shares, priced at P14.64 each, amount to 378,817,279 common shares and account for 15.39% of the issued and outstanding capital stock of 2GO.

The offer price went through an independent third-party fairness opinion by BPI Capital Corp. as the independent third-party valuation provider. BDO Securities Corp. was tapped as the tender offer agent.

SM Investments’ tender offer period is set to start on March 15 at 9:00 a.m. and end at 3:00 p.m. on April 28, unless extended by the company with approval from the Securities and Exchange Commission.

During the tender offer period, tendering stockholders of the company may offer a portion or all their common shares in 2GO to be accepted and sold to SM Investments.

While the period remains open, shareholders who have previously tendered shares are allowed to withdraw their shares at any time.

“Expectation is for many shareholders to partake in tender offer since the price was around double of what it was trading prior to the announcement,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

During the voluntary delisting of 2GO on the main board of the Philippine Stock Exchange, its shares were trading at P14.24 apiece, or higher by 56.5% than the P9.10 closing price before the tender offer announcement.

“Value turnover was rapidly increased as well,” Mr. Limlingan added.

“For sure everyone will be tendering their shares since SM wants to make 2GO private, 15% is the remaining public float. It is just a small chunk that SM can easily buy,” said Mercantile Securities Corp. Head Trader Jeff Radley C. See in a Viber message.

SM Investments has said that the tender offer was meant to delist 2GO shares from the stock exchange’s main board. It currently owns 52.88% of 2GO, while Trident Investments Holdings Pte. Ltd. holds 31.72%.

Mr. See also said that a large number of stakeholders are likely to tender their 2GO shares as these might not be easily sellable once the company becomes private.

On the local bourse on Monday, shares in SM Investments were unchanged at P875 apiece. — Adrian H. Halili