Chelsea Logistics Holdings Corp. of businessman Dennis Uy said Monday it signed an agreement to acquire Batangas-based shipping company Starlite Ferries Inc. and its subsidiaries that operate more than a dozen vessels.
CLC said in a disclosure to the stock exchange it signed a memorandum of understanding with the owners of Starlite to purchase 100 percent of the shares of stocks of the company and its subsidiaries. It did not disclose the cost of the transaction, but the deal required the approval of the Philippine Competition Commission, an agency tasked to look into mergers worth at least P1 billion.
The transaction is pending due diligence by CLC of Starlite and is subject to regulatory approval by PCC.
Starlite and its subsidiaries have a total of 14 vessels in the fleet, including five roll-on, roll-off passenger vessels which were acquired brand-new in 2016 and 2017.
Starlite services via RoRo vessels the ports of Batangas, Calapan, Puerto Galera, Roxas and Caticlan. With its brand-new vessels, Starlite looks to expand further to other ports of operation.
“The planned acquisition will bring us a step closer to fulfilling our commitment to growth in order to realize more value for our stakeholders, from the investors to the consumers,” Uy, who serves as CLC chairman, said.
CLC said once all the processes and regulatory approvals were obtained, the acquisition would be financed by the net proceeds of the company’s initial public offering of common shares.
CLC earmarked P1.78 billion of the proceeds for fleet expansion; P245 million for purchase and/or upgrade of ports, port facilities, containers, machineries and equipment; P3.20 billion for acquisition of shipping and logistics firms; and P278 million for general corporate purposes.
“By modernizing and expanding our operations, we can provide better shipping and logistics solutions as well as make our country more competitive in capturing the increasing trade opportunities in Southeast Asia,” Uy said.
The Udenna Group of Uy ventured into shipping in 2006 through Chelsea Shipping Corp. to support the operations of Phoenix Petroleum Philippines Inc. It has since grown the business into the country’s biggest logistics group with the largest tanker fleet in terms of capacity.
CLC further grew the group with the acquisition of a 28.15-percent indirect economic interest in 2Go Group Inc. in March this year.
Excluding the fleet of Starlite, CLC has 11 tankers, eight tugboats, seven roll-on/ roll-off vessels with passenger accommodation (RoPax), four barges and three cargo ships. In addition, 2Go Group had eight RoPax, 10 Fastcrafts and eight cargo vessels.