Benguet Corporation, a mining firm controlled by the Romualdez family, reported that the Red Earth Mineral Resources Corporation is infusing P440 million into the company through a subscription of new shares.
In a disclosure to the Philippine Stock Exchange, Benguet said its Board of Directors had approved Red Earth’s proposal for a Private Placement in the company.
In the first part, the Private placement calls for the subscription of 90 million shares from the unissued shares of Benguet consisting of 53 million Class "A" common shares at P4.00 per share and 37 million Class "B" shares also at P4.00 per share.
In the second part of the Private Placement, Red Earth will subscribe for 20 million shares from the increase in Benguet’s capital stock, which will be broken down into 13 million Class "A" common shares at P4.00 per share and 7 million Class "B" common shares at P4.00 per share.
“The subscription price of P4.00 per share for both classes is based on the 30 trading days volume-weighted average price (VWAP) plus premium prior to October 29, 2024. Par value is at P1.00 per share for both classes,” Benguet said.
Benguet currently has 375.12 million outstanding shares, but it is not yet clear how big a stake in the company Red Earth’s substantial acquisition will translate to.
The disclosure said that, “At the conclusion of the Private Placement, public ownership percentage is 39.0 percent of the outstanding capital, down from the current 45.9 percent.”
It noted that, “The additional capital infusion will be used for the development of the Pantingan Gold Project, Bolco Gold Project, Solar Project, Agribusiness Project and other priority projects of the Company.”
Red Earth is a company incorporated and registered with the Securities and Exchange Commission (SEC) on August 10, 2018. Originally established to engage in surface mining, Red Earth has evolved to encompass a broader spectrum of activities and strategic pursuits.
Under its revised corporate mandate, Red Earth has diversified its operations to include dealings in all kinds of properties. This expansion enables the company to engage in investments in bonds and shares of capital stock, thereby enhancing its financial portfolio and capitalizing on various market opportunities.
Another Romualdez-controlled company, publicly-listed Bright Kindle Resources & Investments Inc., recently acquired Strong Built (Mining) Development Corporation where Red Earth owned a 30 percent stake.