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SMC wants more time for Holcim tender offer

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By James A. Loyola

Diversified conglomerate San Miguel Corporation (SMC) is asking the Securities and Exchange Commission (SEC) to allow it to delay the mandatory tender offer for the minority shares of Holcim Philippines Inc. after winning the bid to acquire control of the cement manufacturer.

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In a disclosure to the Philippine Stock Exchange, SMC Chief Finance Officer Ferdinand Constantino said the firm has filed an application for exemptive relief with the SEC relating to the conduct of the mandatory tender offer.

The tender offer is to be made by First Stronghold Cement Industries, Inc., a wholly-owned subsidiary of San Miguel Equity Investments, Inc. which, in turn is a wholly-owned unit of SMC.

SMC asked the SEC to allow First Stronghold to launch, conduct and settle the mandatory tender offer only after approval by the Philippine Competition Commission of its acquisition of 85.73 percent of Holcim Philippines.

The conglomerate is also seeking a delay in the tender offer until “the completion of the post-closing purchase price adjustment, in accordance with the agreement by the parties, which may result in an upward or downward adjustment in the purchase price.”

First Stronghold will have to conduct a tender offer for 14.27 percent of Holcim Philippine worth about $357 million after acquiring the majority stake for $2.15 billion.

First Stronghold Cement Industries Inc. has entered into definitive agreements with firms controlled by LafargeHolcim Ltd. for the purchase of 85.7 percent of Holcim.

This is on a 100 percent basis, inclusive of fees for transitional service agreements.

Holcim Philippines said the agreement was executed by Holderfin B.V., First Stronghold, SMC and Lafargeholcim Ltd.

Under the agreement, Holderfin will sell its shares in Holcim Philippines and shall buy Cemco Holdings, Inc. and Union Cement Holdings Corporation to also sell their shares to First Stronghold, which is a wholly owned subsidiary of San Miguel Equity Investments, Inc. which, in turn, is a wholly owned subsidiary of SMC.

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