By James A. Loyola The government is offering P472.12 million to buy the Philippine Stock Exchange’s (PSE) stake in Philippine Dealing System Holdings Corporation (PDS) after rejecting the PSE’s own plan to acquire control of the fixed income bourse. In a disclosure, the PSE said it has formally received an offer from the Land Bank of the Philippines to purchase its entire equity interest in the PDS at P360.00 per share. PDS owns the Philippine Dealing and Exchange Corporation (PDEx). The PSE added that the “offer is subject to certain conditions. The offer is yet to be discussed by the Company’s Board of Directors.” In denying the PSE’s petition for exemption from the 20 percent ownership cap for a securities exchange, the Securities and Exchange Commission reiterated that the PSE has not been able to comply with its own 20 percent ceiling for stock brokers’ stake in the bourse. According to the SEC, total broker shareholders as of February 28, 2018 stood at 18.43 million shares or 21.71 percent of the PSE’s total outstanding capital of 84.93 million shares after a stock rights offering. However, the PSE noted that stock broker ownership would actually fall below 20 percent if the SEC completes the revocation process for stock brokers who have been inactive for at least five years. PSE President Ramon Monzon noted that inactive stock brokers have a total 2.2 percent stake in the PSE and these shareholders will cease to be classified as brokers once the SEC revokes their licenses. Thus, the PSE asked the SEC to consider it to have already complied with the ownership cap if inactive brokers shares are excluded. The SEC has yet to revoke the licenses of these brokers. The PSE’s share purchase agreements with PDS shareholders with a total stake of 72 percent expired on March 31, 2018. These agreements had already been extended three times.