Cosco Capital sells Liquigaz stake, leaves LPG business

Cosco Capital Inc., the listed retail holding company of retail tycoon Lucio Co., is exiting the liquified petroleum gas business with the sale of its entire stake in Liquigaz Philippines Corp.

Cosco Capital through unit Canaria Holdings Corp. said in a disclosure to the stock exchange it sold its 100-percent interest in Liquigaz covering 826,530 shares to Fernwood Holdings, Inc.

The company did not disclose the value of the transaction. The company said the value was less than 12 percent of the total asset of the company as of December 2017.

Cosco Capital said the transaction “is expected to maximize shareholders’ value and for the company to achieve financial flexibility moving forward.”

The transaction is still subject to approval by the Philippine Competition Commission.

Liquigaz Philippines is one of the major distributors of liquefied petroleum gas in the country. It is the second largest supplier of LPG in the country accounting for approximately 30 percent of total market volume and the biggest seller in Luzon, the site of its storage facilities.

Cosco Capital in 2014 acquired 90 percent of the capital stock of Liquigaz Philippines, a wholly-owned subsidiary of SHV Energy of the Netherlands.

Over 60 percent of the country’s total annual LPG importation is unloaded, stored and sold from Liquigaz’s 12,500-metric-ton capacity storage tanks in Mariveles, Bataan, the largest of such facility in the Philippines. It is the only supplier capable of receiving both refrigerated and pressurized LPG cargo.

Liquigaz Philippines generated a 28-percent increase in revenues to P7.59 billion in the first six months of 2018, mainly driven by an increase in sales volume and the recovery in global LPG prices during the period.

Net income, however, declined nine percent to P233 million. 

With the divestment, Cosco Capital will still have several business under its portfolio including Puregold Price Club Inc., S&R Membership Shopping, Ellimac Prime Holdings Inc. and Office Warehouse, Inc. 

Share price of Cosco Capital on Monday climbed 4.2 percent to P6.98.

Topics: Cosco Capital Inc. , Lucio Co. , Liquigaz Philippines Corp. , Canaria Holdings Corp.
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