PHILIPPINE Stock Exchange Inc. (PSE) is looking to take full control of Philippine Dealing Systems and Holdings Corp. (PDS) as early as this year.
The PSE board has greenlit the extension of the timeline for the disbursement of the remaining proceeds from a 2018 stock rights offering (SRO), which enabled the bourse to raise P2.9 billion.
The stock exchange, in a disclosure on Thursday, said it had set aside P1.58 billion, or 55 percent of the net proceeds, to fully acquire PDS and noted that the transaction was targeted to be completed in 2024 or next year.
The PSE, which owns 20.98 percent of the issued and outstanding capital stock of PDS, allocated the same amount in 2018 to fund the servicing of future corporate debt accessed through bridge financing for the deal.
The proposed PDS takeover was stalled during the administration of former president Rodrigo Duterte amid opposition from then-Finance secretary Carlos Dominguez 3rd.
The Securities and Exchange Commission (SEC) last December approved the bourse's application for exemption from the Securities Regulation Code (SRC) rule that limits an organization's ownership and voting rights in an exchange to 20 percent.
The SEC had previously denied the PSE's bid due to ownership restrictions and concerns about its business plans. In November, however, it allowed the bourse to apply for exemptive relief.
The transfer of the shares of stock of an exchange operator was also approved in December, allowing the PSE to buy out PDS shares currently held by other PDS shareholders.
Following these approvals, the bourse was required to report every two months on the status of its negotiations to acquire additional PDS shares, including the share offer price. It was also asked to submit operational and developmental plans and timelines in relation to the fixed-income exchange.
The PDS Group includes Philippine Dealing & Exchange Corp., which operates the organized secondary market for the trading of fixed-income securities issued by corporations, as well as the government.
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