Cebu—(PHStocks)—In a special meeting today, the Board of Directors of Aboitiz Equity Ventures Inc. (PSE: AEV) has approved the proposed offer from Union Bank of the Philippines (UnionBank, PSE: UBP) to purchase all of its shares in City Savings Bank, Inc. (CitySavings), a Cebu-based thrift bank.
AEV, together with its wholly owned subsidiary, Pilmico Foods Corporation (PFC), own 99.54% of CitySavings’ issued and outstanding capital stock. AEV owns 116,262 shares in CitySavings or 59.54% of CitySavings’ total issued and outstanding shares while PFC owns 78,109 CitySavings’ shares consisting of 40% of CitySavings’ equity. Other non-related individual shareholders own the remaining 0.46% CitySavings’ equity.
AEV was advised by its subsidiary, PFC, that its Board has also accepted the offer of UnionBank to acquire the remaining 40% shareholdings in CitySavings held by PFC.
The planned share acquisition is conditional upon UnionBank obtaining the necessary Monetary Board approvals from Bangko Sentral ng Pilipinas (BSP). The CitySavings shares acquisition by UnionBank is subject to a due diligence review and the foregoing regulatory approval. The transaction is expected to be consummated upon the issuance of the relevant regulatory approvals.
The combined purchase of AEV’s and PFC’s CitySavings shares, which will be in cash, will be computed at 2.5 times Sycip Gorres Velayo & Co. audited book value as of December 31, 2012, subject to the results of the due diligence review. The total acquisition value is approximately PhP5.7 billion.
AEV currently owns 44.82% of UnionBank’s total issued and outstanding capital stock and will have a resulting beneficial or attributable interest of 44.61% in CitySavings’ equity post share acquisition by UnionBank.