Melco begins tender offer of Philippine shares

Melco begins tender offer of Philippine shares

MCO (Philippines) Investments Limited, the majority shareholder of Melco Resorts and Entertainment (Philippines) Corporation, has begun the tender offer for shares of the City of Dreams Manila operator.

Melco begins tender offer of Philippine sharesThe offer remains at PHP7.25 ($0.13), the same price as when Melco Philippines first announced the plan to buy from minority shareholders. In its filing with the Philippine Stock Exchange (PSE), the company said the tender offer period will be until November 29. Shareholders who want to dispose of their stock are required to submit their applications to tender offer agent, Maybank ATR Kim Eng Securities, Inc.

“The tendered shares shall be deemed accepted by [MCO] on 5 December 2018 at 3:00 p.m.,” the disclosure read, adding that the settlement shall be on December 13.

Melco Philippines had initially announced the tender offer to commence on October 3, but delayed this while addressing objections from traders that the selling price was low compared to when they were first sold in 2013, at a price of PHP14 ($0.26). Shares currently trade for PHP7.09 ($0.13).

The tender offer was originally part of Melco Philippines’ plan to be delisted from the PSE, but the petition to delist was withdrawn last week, supposedly in order to not “exert undue pressure” on investors’ decisions to sell or hold the shares.

MCO already holds 73% of Melco Philippines shares, but requires ownership of 95% of shares for a delisting to proceed.

City of Dreams Manila is operated by Melco Philippines, with the property leased out by Belle Corporation, which also takes a share in profits from casino operations.

Parent company Melco International Development Limited has been preparing for further expansion, recently having its Macau-based Studio City subsidiary listed on the New York Stock Exchange. The company is also preparing investments for a potential integrated resort (IR) in Japan, after the country’s Diet legislated for the construction of three large-scale casino resorts in still undetermined locations.