LRWC Board Approves Increase in Authorized Capital Stock
Pasig—(PHStocks)—The Board of Directors of Leisure & Resorts World Corporation (LRWC, PSE: LR) had approved a number of items in the Special Board meeting last January 22, 2013 that shall be included in the agenda during the Special Stockholders Meeting scheduled for 22 March 2013:
1. An increase in the authorized capital stock of LRWC to PhP5 billion. This will be divided into 2.5 billion of common stock (par PhP1.00 per share) and 2.5 billion of preferred shares (par PhP1.00 per share). Currently, the Company has an authorized capital stock of PhP1.6 billion.
2. A stock dividend equivalent of 200 million shares.
3. Listing of the preferred shares and warrants on the Philippine Stock Exchange (PSE).
4. Private placement of PhP1.75 billion through a perpetual preferred share issuance.
The perpetual preferred shares will have a coupon rate of 8.5% per annum, paid semi-annually. The Preferred shares are cumulative, non-voting and non-participating.
As an added bonus, LRWC will also issue warrants. Twenty (20) preferred shares will entitle each investor to one warrant. Each warrant, if exercised at a price of PhP15.00 or the average weighted trading price for the three months prior (whichever is lower) will be converted to one common share. This option will be exercisable starting on the fifth year.
Pending approval, the preferred shares as well as the warrants will be listed on the PSE.
The preferred share offering will be used to finance the following:
1. Belle Grande Integrated Resort and Casino project
LRWC’s wholly-owned subsidiary, AB Leisure Global Inc (AB Global) signed a Memorandum of Agreement with Belle Resources and Premium Leisure Amusement Inc. in July 2012.
2. Midas Hotel and Casino project
In November 2012, LRWC bought 51% of the outstanding shares of Hotel Enterprises Philippines Inc. (HEPI). HEPI owns the property and building assets where Midas Hotel is located. The company is looking to expand the facilities of the hotel.
3. Techzone project
LRWC’s subsidiary, First Cagayan Leisure and Resorts Corporation (First Cagayan) is negotiating with a developer for the construction of a world-class BPO building in Makati. The project, called Techzone, will house the licensees and locators of First Cagayan.
4. Acquisition and roll-out of additional bingo sites
The company is focused on rolling out more sites with the electronic variants of its bingo games. In its existing bingo sites, more electronic bingo games (EBG) and Rapid Bingo machines are being deployed. The company’s Bingo Boutique outlets, which contain only electronic games, are also being set up and deployed. Currently, there are 23 Bingo Boutique sites. The company plans to add between 30 – 40 new sites this year.