Oct 182013

MANILA, Philippines – Two property units of mall and banking conglomerate SM Investments Corp. (SMIC) will exit the local bourse early next month.

The delisting of SM Development Corp. (SMDC) and Highlands Prime Inc. (HPI) is in line with the consolidation of Henry Sy’s property companies.

In a memorandum, the Philippine Stock Exchange (PSE) said its board of directors approved the voluntary delisting filed by HPI and SMDC.

PSE also ordered the “delisting of the shares of the companies from the official registry of the PSE effective Nov. 5.”

Early last month, upscale resort developer HPI and condominium builder SMDC filed a petition to exit the local stock exchange. Shares of both companies were suspended from trading as their public ownership level fell below the 10 percent minimum public float requirement.

Privately held SM Land Inc. earlier completed the tender offer for shares of SMDC and HPI “as a part of its efforts to reorganize and consolidate the real estate holdings and interest of the companies that are controlled by the SM Group.”

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In May, SMIC announced the merger of its real estate businesses, creating the most valuable property firm in Southeast Asia.

The P279-billion transaction involved several steps. First, private firm SM Land acquired HPI and SMDC in exchange for shares in shopping mall developer SM Prime Holdings Inc. (SMPH).

SM Land will then merge with SMPH, which will be the surviving entity. The Securities and Exchange Commission last week approved the merger.

SMPH will also acquire specific real estate companies and assets currently held by SMIC like the SM Mall of Asia complex, Pico de Loro and SM Hotels and Conventions Corp.

The transformed SMPH will have P284 billion in current assets from P148 billion, revenues of P58.4 billion from P30.7 billion, net income of P17 billion from P10.9 billion and a total landbank of 920 hectares from 110 hectares.

The consolidated property group’s pro-forma earnings hit P7 billion in the first half, up 14 percent from a year ago, while revenues jumped 14 percent to P31 billion.

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