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Ayala buys back more of its shares from Mitsubishi

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By James A. Loyola

Ayala Corporation has bought back P3.19 billion worth of its shares from its second largest shareholder Mitsubishi Corporation.’

Ayala Corporation logo (Photo courtesy of www.ayala.com.ph/)

In a disclosure to the Philippine Stock Exchange, Ayala said it bought back 3.81 million of its shares from Mitsubishi for P838 per share.

After the purchase, Ayala’s public float decreased to 52.07 percent from 52.38 percent while foreign ownership declined to 27.59 percent from 27.9 percent.

“At current levels, our stock price is quite undervalued and this buyback of our shares will benefit all our existing shareholders,” said Ayala Chief Finance Officer Jose Teodoro K. Limcaoco.

He added that, “we value our relationship with Mitsubishi which remains as our second largest shareholder. This transaction, I understand, is part of Mitsubishi’s portfolio rebalancing exercise with regard to their Ayala holdings, which now stands and will remain at around six percent.”

Mitsubishi started to pare its Ayala holdings in March of 2018 when they sold 8.5 million shares at P934 per share. Then, in January of this year, Mitsubishi unloaded another 13 million shares at P900 apiece.
This most recent sale of 3.8i million shares will leave Mitsubishi with around 37.78 million Ayala shares, making it still the second largest shareholder of the company.

COL Financial said “Mitsubishi’s rebalancing of its AC holdings alleviates some concerns that AC shares will continue to have an overhang based on speculation that Mitsubishi will continue to trim down its holding in AC.”

It noted that, “the move of AC to buyback the shares from Mitsubishi is also a signaling effect that the company thinks their shares are cheap.”

Ayala Land, Inc. (ALI) had earlier acquired the 20 percent equity interest of Mitsubishi Corporation in Laguna Technopark, Inc. (LTI), equivalent to 8,051 common shares, for P800 million.

“ALI will exchange the 20 percent equity interest in LTI for additional shares of stock in Prime Orion Philippines, Inc. (POPI), equivalent to 323,886,640 common shares, subject to conditions to be fulfilled by POPI,” the firm said.

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