Premiere Entertainment Philippines Inc. (PEP) has signed an investment agreement with UK-based equity investors Global Emerging Markets Investment Advisors Inc. and Global Emerging Markets Global Yield Fund Ltd. (GEM) for up to $10 million in new equity in the local listed firm.
In a statement to the stock exchange Wednesday, PEP said under the deal, it may, at its sole option and discretion within the terms and conditions of the agreement, require GEM to buy ordinary PEP shares for up to an aggregate subscription price of $10 million.
"The agreement is one feature of the overall long term funding strategy for PEP which will allow the corporation access to capital, if and when required, over multiple draw downs, thereby minimizing dilution to existing shareholders," said PEP.
PEP intends to use the new funds for future business activities and engagements and for the expansion of its operating subsidiaries.
GEM has committed to subscribe for new equity in PEP up to a total value of $10 million in cash over the next three years at the option of the local corporation.
PEP's exercise of the option will be entirely at its discretion, with no minimum draw down requirement.
"PEP has the command and control on the amount and timing of any investment, through its issuance of a series of draw down notices," the company added.
The number and price per share or subscription price of each issuance, assuming PEP will exercise its option, are determined by a contractual formula based on the trading volume and a discount to the closing bid price of the corporation's common stock, as reported by Bloomberg Financial Markets over the preceding 15 trading days.
The GEM Group, comprising GEM Investment Advisors, Inc. and Global Emerging Markets Global Yield Fund Ltd. and their affiliates, is a $ 2.7 billion alternative investment firm engaged in the management of a diverse set of investment tools centered on emerging markets all over the world.
It is a UK based fund management group with offices in London, New York, Paris and Hong Kong.