The Philippine Stock Exchange said it is now reviewing all options after the Securities and Exchange Commission thumbed down its proposal to acquire Philippine Dealing System Holdings Corp., the operator of the local fixed income exchange.
PSE president Hans Sicat said the exchange was now studying several options, including appealing the SEC decision, putting a new deal or maintaining the current dual exchange structure.
“All options are being considered,” Sicat said.
Sicat said he was surprised at SEC’s ‘modus operandi’ of revealing so many details about the exchange’s proposed buyout proposal and by its ‘name-calling’ strategy.
“On personal note, I think it is a bit surprising that with the press release, they have started to add some adjectives and name calling about the PSE. It is quite obvious they have intentionally either glossed over the facts or decided not to tell you a lot of issues and as a professional who has been in working in capital markets for close 30 years, that is not the right way to do things,” Sicat said.
“The adjective used to describe the PSE either as incompetent and not understanding of what themes are distortions of the truth and does not serve the public or media in terms of trying to understand the issues at hand,” he said.
Sicat said while SEC viewed market consolidation as not necessary, most people in the industry would beg to disagree with the corporate regulator.
PSE said consolidation was taking place in major markets because it allowed synergies and efficiencies particularly in the IT infrastructure to be introduced as well as provide expanded resources and expertise in coming up with more products and services.
SEC on Monday denied the request of PSE to acquire additional shares in PDS in a bid to form a unified trading platform for equities and fixed-income exchanges.
SEC commissioner Ephyro Luis Amatong said SEC made the decision after PSE failed to demonstrate the acquisition would produce any benefit to the investing public, issuing companies or capital market development in general.
PSE’s proposal failed to provide clear and time-bound commitments to demonstrate that the consolidation would translate to meaningful benefits for various stakeholders, he said.