AGI subscribes to 25% of Megaworld's capital hike

Andrew Tan-led Alliance Global Group Inc. (AGI) is subscribing to 2.5 million common shares of the capital stock increase in unit Megaworld Corporation, a transaction that is valued at P10.725 billion.

 

In a disclosure to the Philippine Stock Exchange on Friday, AGI said its board of directors authorized the subscription which would be issued from a proposed P10 billion increase in the latter's capital stock.

 

The subscription of AGI is priced at P4.29 apiece or P10.725 billion. 

 

"AGI sees Megaworld stock as undervalued and remains confident that the real estate market will continue to expand due to strong demand fueled by a robust Philippine economy," the disclosure read.

 

The company will pay 25 percent of the subscription price upon signing of the agreement, with the balance payable once the capital stock increase is approved by the Securities and Exchange Commission.

 

In a separate disclosure, Megaworld said its board approved a P10 billion increase in authorized capital stock equivalent to 10 billion shares at a par value of P1.00 per share.

 

AGI's subscription represents a 5-percent premium over the 30-day volume weighted average price of Megaworld shares.

 

"Proceeds from the subscription will be used for project development, land acquisition, investments and general corporate purposes," the disclosure read. — Danessa Rivera/VS,GMA News