Tycoon Andrew Tan’s holding company Alliance Global Group Inc. is infusing P2.61 billion into property development subsidiary Megaworld Corporation through subscription of new shares.

In a disclosure to the Philippine Stock Exchange, AGI said its Board of Directors has approved the subscription to 1.375 million Megaworld common shares to be issued out of the subsidiary’s P5.5 billion increase in authorized capital stock. 

The shares will be subscribed at the price of P1.90 per share, for a total subscription price of P2.6125 billion. This represents a premium of five percent over Megaworld’s 30-day volume weighted average price (VWAP). 

The subscription is made by AGI to support growth and future business expansions of Megaworld in line with the latter’s strategies and directions.

As previously disclosed by Megaworld, the increase in its authorized capital stock was approved by its Board of Directors on March 25, 2024 and by its stockholders at the recently-concluded Annual Stockholders’ Meeting on May 13, 2024, and shall subsequently be applied for approval by the Securities and Exchange Commission.

Megaworld Corporation is allotting P55 billion for capital expenditures this year as it ramps up the development of malls and office buildings to expand its leasing portfolio.

AGI Chief Executive Officer and Megaworld Chief Strategy Officer Kevin L. Tan said that, they aim to reach three million square meters of gross leasable area (GLA) for both Megaworld Premier Offices and Megaworld Lifestyle Malls y 2030.

This is 52 percent higher than the company’s total leasing portfolio as of end-2023.

Tan revealed that Megaworld’s gross leasable area for office spaces will reach two million square meters by 2030, while gross leasable area for malls will reach one million square meters by then.

“Growing our malls and office segments within the next six years is a big part of our continuing expansion. This year, Megaworld has budgeted P55 billion for capital expenditure, which is an important part of our overall P350 billion five-year capex program that began in 2023.

“The budget will be used to develop our existing and upcoming townships, residential projects, investment properties, as well as land acquisition,” he added.

The new office stocks will be from its townships in Bulacan, Pampanga, Cavite, Bacolod, and Metro Manila. The new retail spaces, on the other hand, will come from its lifestyle mall properties in Cavite, Rizal, Pampanga, Bulacan, Bacolod, Cebu. Davao, Boracay, and Palawan.