Construction firm EEI Corp. said Thursday its board approved two major corporate actions, including the acquisition of P11.41 billion worth of liabilities by a wholly owned subsidiary and the land consolidation of two real estate firms.
In a disclosure to the stock exchange, EEI said it approved the acquisition of the liabilities of First Orient International Ventures Corp. (FOIVC).
The liabilities will be exchanged for unissued FOIVC shares. The company said the assignment of these liabilities is subject to creditor consent, while the issuance of shares requires SEC approval.
The board also approved the consolidation of two wholly owned subsidiaries, EEI Limited and EEI Realty Corp. (ERC).
The firms will be merged under EEI Ventures Inc. (EVI), the company’s designated investment and holding firm for its real estate and emerging businesses.
The transaction will be implemented through a share-swap agreement in which EVI will issue 300 million shares to EEI in exchange for 100 percent ownership of EEI Limited and ERC.
“The move is intended to sharpen strategic focus, improve governance, and enhance long-term value creation,” EEI said.
This strategy will also enable EEI to separate its core construction operations from new growth platforms and provide better alignment of strategy and capital allocation, while allowing real estate and other ventures to develop at a pace and scale suited to their markets.
The consolidation also supports more efficient capital raising, either through partnerships, joint ventures, or an initial public offering (IPO).
“Housing non-construction assets under EEI Ventures makes it easier to attract strategic partners or explore future financing options without affecting the parent company’s balance sheet,” EEI said.
EEI reported this year it will diversify into the real estate business and is preparing an initial pipeline of real estate projects in Makati, Quezon City, Bataan, Cavite and Pampanga.
It currently has a 139-hectare land bank in key locations.
