Roxas and Company, Inc. (RCI) reported today, May 8, that its independent director Aurelio Montinola III has resigned after the firm disclosed the day before, May 7, that his wife has acquired a significant amount of the firm’s shares at a discounted price of P500 million.
In a disclosure to the Philippine Stock Exchange, the firm said its Chairman of the Board received on May 7, 2024 Montinola’s letter dated May 6, 2024, where he was resigning as an independent director of the company effective immediately.
“Montinola has been an independent director of the Company since 2017. The Company recently sold treasury shares to a real estate company associated with his wife which consequently disqualifies him from serving the company as an independent director,” RCI said.
Stonebridge Corporation, a company chaired by Gizela Gonzalez-Montinola, has infused fresh funds in to the company through the purchase of 250 million RCI treasury shares, or approximately 9 percent of RCI which entitles it to one board seat.
At the acquisition price of P2.00 per share, the Montinola investment is at a 47 percent discount to P3.75 per share, the closing price at the PSE on May 6, 2024. Based on this, the share sale translated to a P437.5 million discount or gain for Montinola.
This acquisition makes the Montinola family the third largest group of shareholders in RCI, after the founding Roxas-Elizalde families and solar entrepreneur Leandro Leviste who recently acquired a 10 percent stake.
Prior to his resignation, Montinola was a member of RCI's Executive Committee, Related Party Transactions Committee, Nomination, Election & Governance Committee, and Audit and Risk Committee.
Stonebridge said that, with a 9 percent interest, it will be seeking the election of its nominee to RCI’s Board of Directors. The firm said it invested in RCI to increase its presence in the real estate sector.
RCI has sold a total of 767.5 million treasury shares to date, as part of the company's fundraising program, including a sale of 75 million shares at P0.69 per share on March 7, 2024, 75 million shares at P0.65 per share on February 20, 2024, and 66.9 million shares at P0.44 per share on January 17, 2024.
Based on the company's latest financial statements, it has P1.5 billion of current liabilities in excess of current assets, with the largest portion of unpaid loans due to the Bank of the Philippine Islands, where Montinola is also an independent director.
The cash-strapped RCI has investments in real estate through Roxas Land Corporation and sugar milling through a minority interest in Roxas Holdings. It is also developing solar power facilities within its land in Nasugbu as well as a joint venture for the manufacture of coconut products for export.