The government may develop its own bond exchange to develop the capital market, if the shareholders of Philippine Dealing System refuse to sell their stake to state-run Land Bank of the Philippines, Finance Secretary Carlos Dominguez III said over the weekend.
“What we are doing is we said LandBank can purchase the shares so we can push it ahead. Now we are offering to buy the shares… We are not confiscating anybody’s shares. It’s up to them to sell it to us,” Dominguez said.
“If they don’t want to sell it, well fine. It will be very clear now who doesn’t want to develop the capital market and who are those shareholders of PSE [Philippine Stock Exchange] and PDS. Now that is not going to stop us from doing other things we can do,” he said.
“If they don’t want to sell it, then we will set up the bond system. We can do it. We will have a department in LandBank or DBP [Development Bank of the Philippines] or both together that will promote bonds to the MSMEs [micro, small and medium enterprises]. We can do it,” Dominguez said.
Dominguez said if the other parties would not cooperate, that would not be enough reason for the government to stop from fulfilling its obligation to improve the capital market.
“We are making a fair offer. [If] they don’t want to sell… we cannot force them, we will not confiscate the shares from them. But it will be very clear to the public who doesn’t want to develop the capital market…That will not stop us from developing it,” Dominguez said.
LandBank issued “fresh offer letters” to all shareholders of the Philippine Dealing System and Holdings Corp. last week to inform them of its intention to acquire the majority stake in the fixed-income exchange.
LandBank president Alex Buenaventura said at the sidelines of an event at the Bangko Sentral ng Pilipinas the bank opted to again send letters to PDS shareholders “because [in] the first round which we did last March, not too many accepted our offer.”
LandBank earlier issued offer letters to all shareholders of PDS, but only one accepted the offer.
“We’re quite confident because the PSE has already pulled out from the intent to acquire majority of PDS so that brings LandBank as the only interested party now. Our offer is P360 [per share], which is higher than their offer before at P320 and our offer is in cash. PSE’s offer was in stocks,” Buenaventura said.
Buenaventura said with PSE pulling out of the plan, it would encourage many PDS shareholders to sell to LandBank. He said LandBank would keep its offer to buy the shares at P360 apiece.
Buenventura earlier said LandBank, the fourth-largest lender in terms of assets as of end-December 2017, would spend around P1.5 billion to acquire the 66.67-percent stake in PDS.