Philippines: Antitrust watchdog clears Udenna’s $120m takeover of 2GO shareholder

Udenna Corp's Dennis Uy

The Philippine Competition Commission (PCC) has finally approved Udenna Corp’s $120-million takeover of KGL Investment B.V. (KGLI-BV), a Dutch company that indirectly holds a minority stake in local logistics giant 2GO Group, three months after the antitrust watchdog blocked the deal.

In a statement, the PCC said, it has approved the acquisition by Udenna of the entire outstanding capital stock of KGLI-BV after it found that the deal does not result in substantial lessening of competition with the Philippine market.

“There are no existing horizontal overlaps or vertical relationships that exist between the parties,” the antitrust watchdog said.

The decision comes three months after the PCC rendered the transaction void and imposed a P19.6 million ($374,000) fine on the parties for consummating the deal without clearance from the antitrust commission.

The PCC Mergers and Acquisitions Office (MAO) found that Udenna, a holding company owned by tycoon Dennis Uy, bought the entire shareholdings of KGLI-BV, as signed by the two parties through a Share Purchase Agreement dated July 28, 2016, and the deal consummated as reflected in a Deed of Transfer dated August 19, 2016.

Uy is the co-founder of Phoenix Petroleum Philippines Inc, and founder of Chelsea Logistics Holding Inc. He is currently the CEO and president of Comstech Integration Alliance Inc, a unit of Manila Electric Co.

Under the Philippine Competition Act (PCA), parties to the merger and acquisition deals above P1 billion ($19 million) are prohibited from consummating their agreement until 30 days after providing notification to the commission.

In compliance with the PCC order, the parties then filed their notification on March 23 and entered the Phase 1 review on April 5. The firms also paid the fine on April 19 at the National Treasury as part of the compliance order,” the PCC said.

Post the deal, Udenna will own 100 per cent of the KGLI-BV.

Udenna is engaged in diverse business interests including distribution and retail of refined petroleum products and lubricants, tankering and inter-island transport of petroleum products and other bulk products.

It is also engaged in ship management, operation of oil depots and storage facilities, operation of an industrial park, real estate or property development, and waste management and environmental services through its subsidiaries.

KGLI-BV, on the other hand, is a holding company maintaining a single investment portfolio in the Philippines, which is the minority interest in KGLI-NM Holdings, Inc.

KGLI-NM’s subsidiary is Negros Navigation, which in turn owns 2Go Group. Negros Navigation and 2Go are domestic corporations with businesses in shipping and logistics.

In a separate disclosure to the Philippine Stock Exchange, 2GO confirmed the approval from the country’s antitrust watchdog.

Also Read:

Dennis Uy-backed Udenna to acquire Philippine H2O Ventures from Jolliville

Philippines: Logistics major 2GO invests in on-demand delivery startup Mober

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.