The Philippine Stock Exchange is distancing itself from the decision of DITO CME Holdings of cash-strapped businessman Dennis Uy to defer its P8 billion stock rights offering four days after the end of its fundraising activity.
DITO notified the PSE on January 29 that its management led by Uy has decided not to pursue the SRO because “current market conditions are less than ideal to pursue the offering.”
DITO offered to sell 1.64 billion shares at P4.88 each from December 27 to January 25. The SRO was extended by a week because of the poor demand for the third telco player’s stock.
The PSE said the listing notice issued on Saturday, January 29 should not be construed as its approval of DITO’s deferment of the SRO.
“This is without prejudice to any regulatory action that the Exchange may pursue in order to ensure full compliance with the applicable rules and for the protection of the investing public,” the PSE said.
“ The posting of this notice is strictly for dissemination purposes only. The company, its underwriter (China Banking Corp.), and other advisers are responsible for strict compliance with the rules of the Exchange. The Exchange disclaims any liability arising from, or in connection with the foregoing matter,” the PSE added.
A stock market source said DITO’s last-minute cancellation has no precedent in the stock market’s history as companies were not allowed to cancel their offerings unilaterally.
“There is nothing wrong with canceling a stock offering but not when the deadline has lapsed for so many days and the money has been collected from investors,” the source said.
“Whether the PSE approves or disapproves the SRO deferment is a problem. It will damage the reputation of the PSE,” said the source.