Philex Mining to sell 20% stake to foreign investors

Philex Mining Corp. is selling the shares it acquired from an extended buyback program, representing 20 percent of its issued shares, to foreign strategic investors to raise funds for new mining projects and the acquisition of new equipment to beef up operations.

As part of a program to enhance shareholder value, Philex has repurchased a total of 209.6 million shares in the open market worth P1.57 billion or P7.50 each share, a premium over its closing price of P7 yesterday. The shares acquired represent 6.7 percent of Philex’s outstanding capital stock. 

In a disclosure to the Philippine Stock Exchange, Philex said it is “engaged in intensive negotiations with several foreign strategic investors for the sale of these shares.”

Among these investors include the group of former Trade Minister Roberto V. Ongpin and London-based investment fund Ashmore Investment Management Ltd., who has been steadily expanding its investment portfolio from gaming and information technology to oil refining and distribution and mining as it continues to seek new platforms for growth.

“As a 20 percent block, these shares command a significant premium over our acquisition cost due to the fact that the acquiring investor can equity account the income of their investment on these shares in their financial statements,” Philex said.

Of the total shares repurchased, 46.19 million shares were acquired by Philex from Gokongwei flagship firm JG Summit Holdings Inc. and 30.02 million from its food and beverage subsidiary Universal Robina Corp.   The shares bought from the Gokongwei Group account for 5.4 percent of Philex’s total issued shares.

Ashmore earlier acquired a 49-percent stake in Philex Petroleum Corp., the oil exploration arm of Philex. It likewise bought Saudi Aramco’s 40-percent stake in oil refiner and retailer Petron Corp.

Philex primarily produces copper concentrates containing copper, gold and silver, which are transported via sea freight and smelted either in Kyushu Island, Japan, in the Sanganoseki smelter of Pan Pacific Copper Co., Ltd. (PPC), a joint venture company between Nippon Mining Co. Ltd. and Mitsui Mining and Smelting Co.

It is also engaged in oil exploration projects in Palawan and in the South Sulu through its unit, Philex Petroleum Corp.

The company owns the Padcal mine in Benguet province, its only operating mine.