Sybase Equity Investments Corp., a privately-held company owned by the family of retail tycoon Henry Sy Sr., is selling its stake in Megawide Construction Corp. back to the company.
Megawide said in a disclosure to the stock exchange it signed a share buyback agreement with Sybase Equity involving 410,842,702 million common shares in the company. The shares represent roughly 17.2 percent of Megawide.
The final acquisition price will be based on the seven-trading day volume weighted average price of the company ending on July 28 2016.
Megawide last week said it was in discussions with a minority shareholder about the possibility of a share divestment. The deal was subject to board approval.
Share price of Megawide has been rising in past few days, trading between P9.31 and P11.31 apiece.
Based on this price range, the sale of 410,842 million common shares will raise between P3.82 billion to P4.64 billion for Sybase Equity.
Sybase Equity was a cornerstone investors when Megawide became a public company in February 2011. Other cornerstone investors were Suyen Corp., which is owned by Ben Chan of Bench, BDO Trust and state-owned Government Service Insurance System
SM Development Corp., the residential business unit of the Sy Group, was one of Megawide’s major clients.
Megawide since has transformed from a pure construction company into a diverse engineering and infrastructure concern, after successfully bagging several infrastructure projects that were bid out during the Aquino administration.
Among these were the P17.5-billion Mactan Cebu International Airport expansion program with Bangalore-based GMR Infrastructure; the P16.42-billion School Infrastructure Project phase I; the P3.86-billion SIP phase II: and the P2.5-billion Integrated Transport System-Southwest Terminal.
Megawide in the first quarter of 2016 reported a 55-percent increase in net income to P573 million from P370 million year-on-year, due to strong earnings from both construction and airport operations.