Cemex Holdings Philippines Inc. (CHP) is remaining neutral and is neither discouraging nor encouraging its shareholders to tender their shares in the P2.1 billion tender offer being made by its parent company Cemex Asian South East Corporation (CASEC).

In a disclosure to the Philippine Stock Exchange, CHP said “The CHP Board expresses no opinion and is neutral toward the Tender Offer.”

“The CHP Board has determined that each CHP Shareholder's decision as to whether or not to tender its shares in the Tender Offer, and, if so, how many shares to tender, is a personal investment decision based upon such individual CUP Shareholder's particular circumstances,” the firm noted.

It added that, “Each CHP Shareholder should carefully read the terms of the Tender Offer attached and made an integral part of the tender offer report of CASEC contained in SEC Form 19-1, filed with the Philippine Securities and Exchange Commission on January 25, 2023, as updated in the Amended Tender Offer Report dated February 10, 2023, and make such decision based on all of the available information.”

The CHP Board of Directors made the declaration as it is required by the Securities Exchange Act of 1934, as amended, and the rules and regulations under it, to inform CHP Shareholders of the CHP Board's position, if any, with respect to the Tender Offer.

CASEC is planning to to acquire up to 1.61 billion CHP common shares from minority shareholders for P1.30 per share. If successful, CASEC will increase its stake in CHP by an additional 11.97 percent to 89.86 percent.

In a previous disclosure to the PSE, Cemex said the tender offer will reduce its public float from the current 22.11 percent to 10.14 percent.

However, it noted that the tender offer is not being made with the intention of delisting its stock from the PSE even though its resulting public float will be close to the PSE’s minimum public ownership requirement of 10 percent.

The tender offer has started and will end on March 16, 2023. Tendered shares will be crossed at the PSE on March 29 and settled on March 30, 2023.

“The Tender Offer is proposed to be conducted for the purpose of increasing and consolidating the Bidder’s (CSEC’s) interests in CHP, and to provide an opportunity for existing public shareholders to realize their investment, at a premium to the current trading price of the outstanding common shares,” Cemex said.

The Tender Offer Price of P1.30 per Tender Offer Share represents a 51.2 percent premium over the last closing share price on January 23, 2023 of P0.860.

It is a 68.5 percent premium over the one-month volume weighted average price (VWAP) of P0.772, and a 64.5 percent premium over the one-year VWAP of P0.791.

After the conclusion of the Tender Offer, and in line with CEMEX, S.A.B. de C.V.’s (CEMEX) strategy, the CASEC intends to “continue taking steps to optimize and rebalance CEMEX’s asset portfolio in the region where CHP operates, which may include an evaluation of strategic investments or divestments.”

Regarding divestments, CASEC actively evaluates divestment opportunities, and does not rule out that, in the short or medium term, it may sell all of CHP’s shares or cause the divestment by CHP of one or more of the operations or assets to other companies that are part of the group headed by CEMEX or to unrelated parties.

Other than these, CASEC has no plans or proposals which would relate to or would result in any change in the present board of directors or management of the Company including, but not limited to, any plan or proposal to change the number or term of directors, to fill any existing vacancy on the board or to change any material term of the employment contract of any executive officer.

It also has no plans to make any material change in the present dividend rate or policy or indebtedness or capitalization of the Company of “to cause any class of equity securities of the issuer which is listed on an exchange to be no longer listed” or cause the firm “to no longer be subject to the reporting requirements of SRC (Securities Regulation Code) Rule 17.”