Cebu-based property developer Cebu Holdings Inc. said Tuesday it is merging with parent company Ayala Land Inc.
CHI said in disclosure to the stock exchange the company and its subsidiaries and affiliates Asian I-Office Properties Inc., Arca South Commercial Ventures Corp. and Central Block Developers Inc. would merge with Ayala Land. The latter would be the surviving entity.
“The merger is an internal restructuring as well as a consolidation of Ayala Land’s Cebu portfolio under one listed entity. The merger is expected to result in operational synergies, efficient funds management and simplified reporting to government agencies,” CHI said.
Under the plan, Ayala Land will issue 0.19 Ayala Land common share for every one share of CHI common share.
Ayala Land will issue 409.78 million ALI common shares, including 291.46 million which the property firm will issue to itself in exchange of its shares held in CHI. All the assets and liabilities of CHI will be absorbed by Ayala Land.
The plan of merger will be submitted for the approval of the company’s stockholders during the annual meeting on April 14, 2021. CHI is a 71.1-percent subsidiary of Ayala Land.
AiO, which is engaged in development and operations of office towers within the Cebu IT Park Estate, is a wholly-owned subsidiary by CHI, while ASCVC, which is developing a mixed-use block within Arca South Estate, is wholly-owned by Ayala Land.
Meanwhile, CBDI is 55-percent owned by the company and 45-percent owned by Ayala Land. CBDI owns and operates the mixed-use block which consists of a 5-story mall, two office towers and a hotel tower stacked on top of the mall and located in Cebu IT Park Estate.
Once the planned merger is approved by the Securities and Exchange Commission, CHI will cease to exist.
The share price of CHI jumped 18.3 percent Tuesday to P6.53. The share price of Ayala Land dropped 0.4 percent to P38.20.
