Gregorio Araneta III’s ₱1.8 billion management takeover of gaming firm PhilWeb Corp. will be undertaken in two tranches, effectively moving back the requirement for mandatory tender offer to minority shareholders.

PhilWeb disclosed to the Philippine Stock Exchange that principal shareholder Gregorio Araneta Inc. (GAINC) executed an amendment to its Share Purchase Agreement with Nexora Holdings Inc. (NHI) and Velora Holdings Inc. (VHI) for the sale of GAINC’s 57 percent interest in the company.

PhilWeb President and Director Edgar Brian L. Ng is also the current President, Chairman, and a Director of Nexora. PhilWeb Vice Chairman and Director Crisanto Roy B. Alcid is a Director and Treasurer of Nexora.

Under the amended agreement, the transfer of the 57 percent shareholding, which totals 829.57 million common shares, will be divided into two segments:

Tranche A will comprise 488.16 million common shares, representing 34 percent of PhilWeb’s issued and outstanding stock, to be transferred to NHI.

Meanwhile, tranche B will cover 341.41 million common shares, representing 23.78 percent of the outstanding stock, to be transferred to NHI and VHI. No timeline for the transfer was provided.

The structure is key to delaying the mandatory tender offer. The Securities Regulation Code requires the Buyers to conduct a mandatory tender offer to all remaining shareholders prior to the completion of the Tranche B shares transfer, as this second tranche would result in the Buyers collectively holding more than 50 percent of the public company's outstanding voting shares.

The tender offer would have been triggered immediately had the acquisition not been split or if the first tranche had exceeded 34 percent. However, interest in the mandatory tender offer may be low since the acquisition is priced at ₱2.17 per share, significantly below PhilWeb’s closing price of ₱6.40 per share last Friday.

“The Buyers are domestic holding companies duly organized and existing under Philippine law, established to acquire, hold, own, dispose of, exchange, or otherwise invest in securities, properties, and related assets," PhilWeb stated.

The company also confirmed that none of the buyers are "engaged in securities brokering, portfolio management for third-party clients, public solicitation of investments, or the issuance of investment contracts.”

PhilWeb noted that the completion of the transaction could potentially increase the corporation's foreign ownership levels from 4.9 percent to 40 percent.

The firm, however, pointed out that this increase will not impact its compliance with foreign capital ownership limitations as it “does not own land or is not engaged in a nationalized activity.”

The mandatory tender offer process and participation by shareholders other than GAINC may also affect the Corporation's Public Float levels.