Philex unit to list shares by way of introduction

MANILA, Philippines - Philex Mining Corp. is seeking regulatory approval to list its wholly-owned unit Philex Petroleum Corp. (PPC) at the Philippines Stock Exchange (PSE) by way of introduction.

Introductory listing does not involve an initial public offering (IPO). However, companies that list their shares this way are required to hold an IPO within a year from listing, based on PSE rules.

The rules, which have been revised recently to enhance investor confidence and protection, also require that the securities to be listed be widely held first to ascertain their marketability.

In a disclosure, Philex said its board approved the declaration of dividend composed of shares of stock of PPC, and cash. The dividend ratio will be one PPC share for every 8 Philex shares, and P0.052 for each Philex share.

The PPC shares to be distributed constitute about 36% of its current outstanding capital to be held directly by existing Philex shareholders. Philex, meanwhile, will retain the remaining 64% of PPC.

"Philex will seek Securities and Exchange Commission (SEC) approval of the dividend. PPC will seek SEC approval of the registration of its shares and PSE approval of a listing by way of introduction," Philex said.

"We believe that the listing of the PPC shares will make the value of the petroleum and energy assets of Philex more visible, and allow such assets to realize their full value outside of the Philex share value," added Philex's chairman and CEO, Manuel Pangilinan.

PPC controls Forum Energy Plc, a company based in United Kingdom that has a 70% interest in Service Contract (SC) No. 72 covering the Sampaguita natural gas discovery. It also has interests in various petroleum service contracts.

PPC also owns 18.46% of Pitkin Petroleum PLC; 10.31% of PetroEnergy Resources Corp.; 100% of Brixton Energy & Mining Corp., a coal mining firm operating in northern Mindanao; and has overriding royalty interest in SC 6 (Cadlao) and a participating interest in SC 6A (Octon).

Recently, Forum Energy completed a seismic survey of SC 72 contract area in offshore west Palawan by which the hydrocarbon potential of the area could be better assessed. Pitkin Petroleum, on the other hand, has reported encouraging results from its recently completed appraisal program in Block 07/03 in offshore Vietnam.