Ho Chi Minh City Infrastructure Investment JSC (CII) agreed to sell 30 million CII Bridge & Road (LGC) shares to the Philippine-based Metro Pacific Tollways Corporation (MPTC) through an issuance of $48.6 billion convertible bonds.
The total value of the deal is estimated to exceed VND1.95 trillion ($91.5 million).
At the signing ceremony, CII chairman Le Vu Hoang said that the enrollment of MPTC affirmed CII Bridge & Road’s capacity and potential in the future.
In 2014, CII acquired LGC and then quickly approved the plan to sell the aforementioned LGC stake and also to issue exchangeable bonds.
Le Quoc Binh, CII general director said: “Initially, we decided to sell only 20 million LGC shares. Thus, we will acquire 10 million more in the company’s next issuance to shareholders.”
According to a decision published on January 12, the mother company will purchase 9.12 million buy-options from its subsidiary at the options’ rate of 3:2, implying the possibility of purchasing a total 6.081 million shares from January 16 to February 2.
CII pledged to shareholders to hold a minimum stake of 51 per cent in CII Bridge & Road to avoid a possible takeover.
“We choose MPTC as a strategic partner because of the similarities between CII and the Philippines group, who will support us not only with finance but also technology and their expertise,” said Binh.
MPTC is known as the largest toll road operator in the Philippines, owning and operating 63 per cent of the total 320 kilometres of toll roads in the country. It is a subsidiary of the Metro Pacific Investments Corporation (MPIC) – the Filipino leading infrastructure investment firm with market capitalisation up to $3 billion.
Meanwhile, CII Bridge and Road is operating seven major bridge projects, mainly in HCM City. It also plans to invest $1.7 billion in nine new projects.
The HCM City Stock Exchange has announced changes in CII’s foreign ownership ratio, which will be lifted from 34.68 per cent to 39.98 per cent from today.
This year, CII expects to obtain over VND3.1 trillion ($145.5 million) in revenue and VND670 billion ($31.4 million) in net profit, and to pay dividend for shareholders at 12 per cent at least.
CII closed today’s trading up 4.23 per cent to VND19,700 ($0.9), while LGC concluded 2.35 per cent higher to VND30,500 ($1.4).