US fund manager pulls out of RCBC

MANILA, Philippines - Spinnaker Capital Group is pulling out its investments in the Yuchengco-led Rizal Commercial Banking Corp. (RCBC) worth about P2.25 billion, equivalent to over 148 million shares.

RCBC has bought back roughly 92 million shares of the total shares held by Spinnaker Capital while Pan Malayan Management Investment Corp., the holding company of RCBC, acquired the remaining 56 million shares.

In effect, Spinnaker Capital has given up its two seats in RCBC’s board.

Bank sources said Spinnaker Capital, as a fund manager, is either de-leveraging from investments in the Philippines or coping with large redemptions from investors as a consequence of the global financial crisis.

Spinnaker Capital is a US-based financial institution that specializes in the emerging markets. It also makes investments in both sovereign and corporate credits to diversify its portfolio.

Its investments in RCBC are in the form of three funds, namely Spinnaker Global Emerging Markets Fund Ltd., Spinnaker Global Strategic Fund Ltd. and Spinnaker Global Opportunity Fund Ltd.

In 2006, Spinnaker Capital acquired the shares held by Tokyo-Mitsubishi UFJ Ltd. (BTMU) equivalent to approximately 17.14 percent equity in RCBC, as the Japanese bank giant wanted to consolidate its resources in major deals in Japan.

United Financial of Japan (UFJ), a subsidiary of UFJ Holdings, was the original holder of the shares. However, UFJ Holdings was merged with Mitsubishi Tokyo Financial Group, resulting in BTMU.

It was estimated that Spinnaker Capital shelled out P2.3 billion for the purchase of the BTMU stake, based on the closing price of P21.25 per share at the time of the transaction.