Sime Darby halves capitalization as part of restructuring

MANILA, Philippines - Tire maker Sime Darby Pilipinas Inc. (SDPI), a member of the Sime Darby Group of Malaysia, is reducing its capitalization by more than half from P500 million to P245 million.

Based on documents it filed with the Securities and Exchange Commission, SPDI said the decrease forms part of it equity restructuring program aimed at cleaning up its balance sheet.

SDPI said the P255-million reduction will be returned in cash to stockholders of record as of Nov. 13, 2008.

The planned equity restructuring will be implemented in order to wipe out the deficit as of Oct. 25, 2008 of P271.41 million.

After the decrease in capitalization and equity restructuring have been implemented, SDPI will have total assets of P501.71 milion and liabilities of P154.52 million.

Prior to the sale of its tire manufacturing assets, Sime Darby Pilipinas was a key player in the production and sale of automotive tires in the Philippines. In 1996, the company obtained approval from the SEC to broaden the scope of its business to include any manufacturing, trading or service business.

The corporation has also extended its distribution activities in the Philippines which now include agricultural and industrial equipment, allied agro industrial implements and other specialty products.

Currently, SDPI’s core businesses comprise of property development, tractors, trading and distribution. These activities are conducted through wholly-owned subsidiaries SDII (Sime Darby Industries Inc.) and SDRDC (Sime Darby Realty Development Corp.).

The Sime Darby Group is one of East Asia’s largest business conglomerates.