062607: Keys to an effective consumer Wi-Fi strategy - analysis

Tuesday, June 26, 2007 | MANILA, PHILIPPINES

News

As Asia continues to make metro-WiFi commitments, led by Singapore, Hong Kong and Australia, questions must be asked. Questions about metro-WiFi’s global success to date, business models and even whether the consumer wireless broadband market exists at all beyond niche segments must be asked.

Unfortunately, this article cannot address all these areas, however, we do have room to make some initial observations about the keys to an effective consumer Wi-Fi strategy.

Firstly, as with voice, consumers demand coverage. Network access must be available when needed or else charging must be minimal.

Although recent Wi-Fi enhancements and mesh networks can overcome some shortfalls, Wi-Fi is generally not suited to providing the wide-area wireless broadband coverage users demand. This may limit the business model for general public paid-for access, outside the enterprise.

Coverage limitations in Ovum’s view necessitate operators to provide some level of free or very low cost access — like in Singapore’s Wireless@SG — to capture the interest of average consumers.

The business case may also be supported with advertising, community network models or other innovative services. The low cost of Wi-Fi chipsets and embedded connectivity into various devices means, Machine-to-Machine services or partnerships for utility-based applications such as remote reading of electricity or water meters are other possibilities.

Integrated mobile and fixed operators deploying Wi-Fi also have various other alternatives available. Wi-Fi can be combined and leveraged across other technologies, different users and products while using innovative business models and bundling.

Broadband or mobile offers can include Wi-Fi access as a differentiating free or low cost, value-added service add-on.

Wi-Fi also creates differentiation and potentially new service possibilities in converged services and the home. Converged offerings could be based around voice or data. Voice over Wi-Fi using UMA (Unlicensed Mobile Access) is the predominant voice approach.

This strategy potentially enables zone-based (home, office, campus or hotspot) or other innovative tariff options. A similar HSPA/Wi-Fi strategy will leverage each technology’s strengths and overcome the inherent coverage weakness in Wi-Fi.

For mobile operators, Wi-Fi can be used to increase network capacity, extend and improve mobile coverage and performance.

Moving traffic — voice, but especially data — of mobile networks onto Wi-Fi is advantageous for a number of reasons. Wi-Fi can also allow faster speeds, be used indoors, at home and in areas where stationary mobile data use is likely such as cafes and airports.

Achieving seamless hand-over and an invisible experience from the user perspective between technologies is of principal importance here.

Mobile operators can also use Wi-Fi to help users understand and adopt wireless data solutions. Wi-Fi broadband access can be a low cost, entry level service which can begin to change usage patterns for wireless data and lead to adoption of other wireless data solutions.

Even in SingTel’s case, where free 512k Wi-Fi is being provided, we believe more opportunity can be created than the cannibalization of existing or potential mobile revenue.

Wi-Fi is a key technology in the wireless future, however, there is no one clear business model. Wi-Fi will be used for numerous applications and in Ovum’s view the business model will come from multiple uses, with more than just paid-for-access required, especially in the consumer market. — Nathan Burley

http://www.itmatters.com.ph/news.php?id=062607c

052607: EIB Realty to sell more shares, hike capital

May 25, 2007
Updated 13:38:39 (Mla time)

Xinhua Financial News Service

MANILA, Philippines -- EIB Realty Developers Inc. said its board of directors had approved a plan to sell more shares to raise up to P5 billion, and an increase in its authorized capital stock to P9 billion from P246.3 million currently.

Following EIB Realty's announcement, the stock exchange approved the property developer's request for the suspension of trading of its shares starting Friday and until the company secures approval from the Securities and Exchange Commission for its capital hike and the listing of additional shares.

The stock closed at P0.27 Thursday.

http://services.inquirer.net/express/07/05/26/html_output/xmlhtml/20070525-67942-xml.html

053007: Shares close lower on profit-taking, China slump

May 30, 2007
Updated 13:12:08 (Mla time)

Xinhua Financial News Service

MANILA, Philippines -- Share prices ended lower as investors cashed in on recent gains, with the selling pressure intensifying towards the close as a slump in Chinese markets prompted by an increase in stamp duty on stock trades there weighed on other Asian bourses, dealers said.

The 30-company composite index finished down 54.07 points or 1.57 percent at 3,398.55, off the day's low of 3,394.61. It hit a high of 3,458.60.

The broader all-share index fell 33.71 points or 1.52 percent to 2,179.59.

There were 96 decliners and 23 advancers, while 53 stocks were unchanged.

A total of 5.3 billion shares worth 5.1 billion pesos changed hands.

"Technically, the market is still overbought," said Gomer Tan, vice president for marketing at Regina Capital Development Corp.

He said investors also took the safe side after China's latest move to curb the rapid rise in its stock market.

China's cabinet approved a tripling in the stamp tax on stock trades to 0.3 percent of the transaction value, effective today, in a bid to cool its equity market.

Rommel Macapagal, chairman of Westlink Global Equities, said the Philippine market is now looking for a strong support level after failing to sustain its recent record-breaking run.

Some analysts expect buyers to resurface if the composite index manages to stay around the 3,400 level.

Ayala Land Inc, the most actively traded stock, fell 0.25 peso to 15.00.

Trading in shares of the property developer was briefly suspended earlier Wednesday following a newspaper report that it was looking at robust growth in sales at one of its residential projects.

Philippine Long Distance Telephone Co retreated 70.00 pesos to 2,470.00.

Conglomerate Ayala Corp bucked the trend, gaining 5.00 pesos to close at 520.00.

Food and beverage firm San Miguel Corp's A and B shares were steady at 65.50 and 76.00 pesos, respectively.

 

http://services.inquirer.net/express/07/05/30/html_output/xmlhtml/20070530-68648-xml.html

053007: Banco de Oro, EPCIB to be suspended from trading Thursday

May 30, 2007
Updated 10:48:57 (Mla time)
Erik de la Cruz
Xinhua Financial News Service

MANILA, Philippines -- Trading in shares in Banco de Oro Universal Bank and Equitable PCI Bank will be suspended from Thursday, the stock exchange said.

The exchange did not say when the trading suspension will be lifted.

The two banks have secured all regulatory approvals required for their merger. The P613-billion merged entity will be known as Banco de Oro-EPCI Inc and will be the Philippines' second-largest bank in terms of assets.

At 10:17 am, Banco de Oro was steady at P66.50 and Equitable PCI was unchanged at P117.00.

http://services.inquirer.net/express/07/05/30/html_output/xmlhtml/20070530-68631-xml.html

053007: Ayala Land suspended; clarifies report on project

May 30, 2007
Updated 10:00:47 (Mla time)
Rocel Felix
Xinhua Financial News Service

MANILA, Philippines--The Philippine Stock Exchange said trading in shares of Ayala Land Inc was halted following a newspaper report that the property developer was looking at robust growth in sales at one of its residential projects.

Responding to the report in the Manila Times, Ayala Land it was projecting 75-percent growth in sales this year at its Community Innovations Inc to Filipinos working overseas.

Trading in the stock resumed at 10:00 am.

http://services.inquirer.net/express/07/05/30/html_output/xmlhtml/20070530-68627-xml.html

050307: Waterfront's net profit drops to P32.6M from P45.1M

By Honey Madrilejos-Reyes

reporter

WATERFRONT Philippines Inc. (WPI), the largest Filipino-owned hotel chain in the country, reported a lower-net profit of P32.6 million last year from P45.1 million the previous year Operating expenses surged 11.5 percent to P1.45 billion in the same comparable period. Consolidated revenues, however, went up to P1.91 billion from P1.80 billion. Listed at the Philippine Stock Exchange, WPI is 63-percent owned  by plastics king William Gatchalian, through his investment arm Wellex Group Inc. It operates five hotels comprising a total of 1,550 rooms situated in the three island groups of the country. The Philippine Amusement and Gaming Corp., through Casino Filipino, operates several gambling dens in the various Waterfront Hotels. In Manila, it currently operates the Manila Pavilion Hotel and Casino. Down south, it has the Waterfront Cebu City Hotel and Casino and the Waterfront Airport Hotel and Casino Mactan; and the Waterfront Insular Hotel Davao. Cumulatively, the company operates close to 1550 rooms, employs 1560 employees and has over 41,300 square meters of convention and gaming space. Earlier, Wellex said it is spending more than P5 billion for the development of a hotel-residential resort in Uson Island, Coron, Palawan. To be called Waterfront Island Resort, Gatchalian said the project would sit on a 1, 200-hectare property that he bought 15 years ago. First phase of the project involves the construction of three hotels with 300 rooms each. The hotels will be built near the white sand beach area and will occupy 600 hectares of the property. “The hotels would cost around P2 billion,” Gatchalian said. “We would start building this year and expect to complete all three by 2009.” The second phase, meanwhile, would be dedicated for residential-resort type of development, said Gatchalian. It would occupy at least 100 hectares of the large property. The third facet of the development would be for necessary amenities, including a convention area. According to Gatchalian, his group’s goal is to increase the number of hotels to 20 through acquisition and construction of new ones. “... Three to five hotels are almost in our hands,” he said.

 

http://www.businessmirror.com.ph/05032007/companies03.html

050307: RP stocks rise on strong earnings

By Ian C. Sayson

Bloomberg

PHILIPPINE stocks rose for the first time in three days. Security Bank Corp. climbed after the lender said first quarter profit increased, boosting expectations of strong earnings this year. “The strong earnings that are coming out are driving up the market,” said Ron Rodrigo, head of research at Manila-based Unicapital Inc. “Strong earnings is a validation the economy is expanding.” Megaworld Corp., Filinvest Land Inc. and other builders rose on speculation a drop in oil prices will boost spending on homes. The Philippine Stock Exchange index added 1.26, or less than 0.1 percent, to 3271.99 at the close, after a two-day, 2.4-percent slump. Gainers outnumbered losers 12 to eight, with 13 stocks unchanged in the main stock measure. The measure pared a gain of as much as 1.2-percent earlier. Security Bank, whose shares rose more than five times in the past four years, jumped P1, or 1.3 percent, to P79, its highest close in six days. The nation’s seventh-largest lender by market capitalization said April 30 that first-quarter profit grew 40 percent to P758 million. The drop in global oil prices in the previous two days supports expectations that corporate earnings and consumer spending could grow further this year, according to Rodrigo. Oil prices fell 3.1 percent in the previous two days to $64.40 a barrel Tuesday, the lowest since April 24. It last traded at $64.50 a barrel earlier Wednesday.   Meralco gains “LOWER oil prices are good for the economy and corporate earnings,” Rodrigo said. Rodrigo expects net income of Philippine companies to grow at least 15 percent this year on a minimum 20 percent expansion in sales. Megaworld, one of the nation’s two biggest builders of residential and office towers, gained 10 centavos, or 3.1 percent, to P3.35, ending a two-day, 7.1 percent slump. Filinvest Land Inc., the nation’s largest builder of affordable homes, added 2 centavos, or 1.1 percent, to P1.80, its first gain in six sessions. DMCI Holdings Inc., a construction company that has expanded to residential developments, surged 30 centavos, or 4.2 percent, to P7.40, a two-month high. Manila Electric Co.’s Class A shares, equity reserved for Filipinos in the nation’s largest power retailer, added P2.50, or 3.5 percent, to P74.50, a two-month high. Its Class B shares, which have no ownership restrictions, gained P2.50, or 3.5 percent, to P75.   C&P Homes MERALCO shares have advanced at least 9 percent since May 24, when the utility said it had a P532 million profit in the first quarter, compared with a P657-million loss in the same period a year ago. Shares worth P3.99 billion were traded, 2.9-percent less than the six-month daily average. Gainers beat losers 52 to 43, with 63 stocks unchanged in the broader market. Separately, C&P Homes Inc., a Philippine homebuilder owned by the family of Senate president Manuel Villar, rose 6 centavos, or 2.6 percent, to P2.40. The company said April 30 that the shares of its majority owners will be swapped with shares of Vista Land and Lifescapes Inc. in a transaction valued at P7.43 billion or about P2.46 a share.

 

http://www.businessmirror.com.ph/05032007/companies02.html

050307: Globe now claims 17-M subscribers

GLOBE Telecoms’ cellular subscriber base grew by about 1.3 million from last year’s 15.7 million. Globe head for regulatory affairs Froilan Castelo said in a letter to the National Telecommunications Commission (NTC) that the company’s mobile phone subscribers are now “close to 17 million.” The letter was dated April 24, 2007. The company’s subscriber base grew 26 percent in 2006 from 2005 as unique and relevant value offers designed to address the specific needs of Globe’s priority segments helped drive the firm’s growth and improved its market position. “We are particularly pleased with how the market has warmly received our various service offers, and we look forward to introducing more compelling propositions in 2007,” Globe president Gerardo Ablaza had said in February. The strong performance of Globe’s wireless service offerings boosted the company’s net income by 11 percent to P11.8 billion in 2006 from P10.3 billion a year earlier. --L. Lectura

 

http://www.businessmirror.com.ph/05032007/headlines012.html

050207: Fugen Marketing goes into 'texting' business

By Dennis D. Estopace

Reporter

FUGEN Marketing Inc., a wholly-owned Filipino manufacturer of herb-enhanced coffee, has ventured into the network marketing business on the short messaging service (SMS) platform of mobile phones. “We want consumers to start earning, and upend the pyramid,” Fugen executive Ricky Torres Jr. told reporters. Torres explained that his company aims to make some of the 42 million mobile-phone users who exchange SMS—popularly known as texting—earn as quasi-dealers and retailers of electronic load, or the monetary unit used in making calls and sending SMS. Some 200 million to 250 million text messages are sent daily. Business from prepaid e-Loads alone amount to over P80 billion a year, according to Torres. He did not cite the source of his numbers. Torres explained that consumers are at the bottom of the pile when it comes to making money in this system of business, while telecommunication firms, dealers and retailers of prepaid load make good bucks out of the whole scheme. Torres cited Smart Communications Inc., which has only 800,000 retailers selling to nearly 20 million prepaid subscribers. According to parent Philippine Long Distance Telephone Co.’s 2006 financial report, the combined number of subscribers of Smart and PilTel increased by 3.776 million or 18 percent to 24.175 million. PLDT said text messaging contributed significantly to the revenue growth in Smart’s cellular data service in 2006, generating revenues of P34.403 million, or 12-percent increase over 2005. Globe, on the other hand, registered 15.7 million wireless subscribers, saying that only 4 percent of these are post-paid users. “We’re eyeing to get a slice of this huge market,” Torres said. Encouraged by the numbers, Torres and his group have put up a new company called MBFII to get a slice of the text messaging pie. MBFII plans to sell membership cards at P2,888 each. A membership  comes with 50 retailer’s cards at P100 each. The card allows buyers to sell or transfer electronic loads to any telecommunications network using his existing Subscriber Identity Module, or SIM card. He gets a 10-percent retained load in his electronic wallet for every retailer’s card sold. The member gets additional peso points if he can get 10 members in two weeks. Based on their computation, Torres said sellers of their products could earn up to P16.7 million in five months if their “down-line” consumes P30-worth of SMS a day. MBFII members, compared to competitors, could reach up to ten and are also allowed to sell other products like its coffee or chocolate herb drinks. Likewise, the firm is open for a franchise investment worth P65,000, allowing the buyer to become a franchisee. Torres told BusinessMirror they invested P2 million, including purchase of hardware and development of the firm’s computer infrastructure. MBFII is a relatively new company “but we’re optimistic because mobile phone loads have become a necessity, like food and shelter, to many Filipinos,” according to Torres. The firm, registered in November last year with the Securities and Exchange Commission, could also sell Internet access cards and consumable products on wholesale and retail basis. The documents submitted by the company to the SEC said five directors, including Torres and his wife Fely, put up P1 million as MBFII’s authorized capital stock. The company operates beside Fugen’s manufacturing plant on Chino Roces Avenue Extension, Makati City. Its secondary purpose is to engage, manage and operate Internet services and computer services, on-line store services, and telecommunication value added services. “It’s time to earn while you text,” Torres said. According to a Research and Markets report, mobile operators worldwide face increasing pressure on profitability as voice revenues continue to fall. “Over the last three or four years mobile network operators have been focusing much of their attention on driving the all-important ‘data-as-a-percentage-of-revenue’ metric,” the report said. “In highly competitive markets, voice revenues are being squeezed harder than ever, churn is a constant problem and most operators are pushing nonvoice service revenues as the savior of ARPU [average revenue per user].”

 

http://www.businessmirror.com.ph/05022007/companies03.html

050107: Index tumbles 48 pts on lack of fresh leads

The Philippine Star 05/01/2007

Share prices closed 1.44 percent lower yesterday in a muted session with investors opting to take profits on a lack of fresh leads, dealers said.

They said investors were also exercising caution ahead of the May 14 mid-term elections, which many see as a referendum on President Arroyo’s government.

The composite index dropped 47.65 points to close at the day’s low of 3,270.73 off a high of 3,318.38.

The broader all-share index dropped 22.90 points to 2,078.72.

Losers beat gainers 68 to 35, with 56 stocks unchanged. A total of 4.5 billion shares worth P3.4 billion were traded.

"There is always that uncertainty before and after every election, so we can expect the market to move sideways in the coming weeks and even shortly after that, a consolidation will take place," said Joseph Roxas of Eagle Equities.

Lawrence de Leon of Accord Capital Equities noted that the average value turnover in recent weeks has been declining, although there has been no heavy selling.

"The daily value turnover average is going down, partly because investors are not buying aggressively as the elections are very close," he said.

"Investors are either unwinding positions, while others are reducing their holdings portfolio."

Top-traded Philippine Long Distance Telephone Co. (PLDT) was among the day’s losers, slipping P15 to P2,540 while rival Globe Telecom Inc. fell five to 1,230.

Conglomerate Ayala Corp. shed P15 to P600, while property arm Ayala Land dropped 75 centavos to P17.50.

Food and beverage conglomerate San Miguel Corp.’s A-shares ended down 50 centavos at P64.50, but its B-shares were steady at P73.

Ayala, the fourth-biggest listed company, fell P15, or 2.4 percent, to P600. Its unit Ayala Land Inc. dropped 75 centavos, or 4.1 percent, to P17.50.

Megaworld Corp., one of the country’s two biggest builders of residential and office towers, declined 20 centavos, or 5.8 percent, to P3.25.

Concern by some investors that the government may borrow more than planned to finance its budget deficit also contributed to the decline in stocks.

"It’s a crowding out effect," said Jose Vistan, head of research at AB Capital Securities Inc. in Manila. "If the government borrows too much, the cost of borrowing for companies will go up.’’ — AFP

 

http://www.philstar.com/philstar/NEWS200705010703.htm

050107: GMA Network readies P7.8-B initial public offer

By Zinnia B. Dela Peña
The Philippine Star 05/01/2007

Broadcast firm GMA Network Inc. expects to raise as much as P7.78 billion from an initial public offering (IPO) of its shares and the issuance of Philippine deposit receipts (PDRs) this year, the company said in its registration papers filed with the Securities and Exchange Commission.

The company will be the second media network to list on the Philippine Stock Exchange next to rival ABS-CBN Broadcasting Corp.

In its filing, GMA said it plans to sell 91.346 million shares through a maiden offering to the public and about 822.115 million PDRs in the international markets at a price range of between P7 to P8.50 each share.

Of the total PDRs being offered, the bulk of 730.769 million are being offered by existing shareholders, namely FLG Management & Development Corp., M.A. Jimenez Enterprises and Television International Corp., the corporate vehicles of the Gozon, Jimenez and

Duavit families, respectively. The remaining 91.346 million PDRs will be sold by the company itself.

GMA said up to P1.55 billion can be generated from the domestic offering and primary PDR offer.

Each PDR grants the right to the delivery or sale of one common share. Although holders of PDRs will enjoy economic rights, they will not have any voting rights in respect of the underlying shares. Such voting rights will, until exercise of the PDR, be retained and exercised by GMA Holdings Inc.

A total of 182.692 million PDRs will be sold in the Philippines while 639.42 million will be sold overseas by Deutsche Bank, the appointed sole global coordinator and bookrunner and lead manager for the international offering.

ATR Kim Eng Capital Partners Inc., on the other hand, will serve as the lead underwriter for the local offering.

GMA has set aside 137.019 million PDRs to cover over-allotments, if necessary.

GMA said bulk of the proceeds from the offering will be used to fund its planned capital expenditures for this year and next year, amounting to P1.888 billion. These include the completion of two new state-of-the-art studios, the comprehensive roll-out of the regional signal strengthening and upgrade project, the implementation of a media asset management system, maintenance expenditures and the build up of the company’s regional infrastructure, production and studio facilities.

The network also plans to use a portion of the net proceeds for general corporate purposes.

As a result of an increase in advertising spending, GMA’s financial performance improved in the last three years from a net profit of P1.5 billion in 2004 to P1.96 billion last year. Net revenues likewise went up to P9.19 billion from only P6.49 billion in 2004.

To broaden its revenue base, the company since 2005 has identified additional revenue streams by broadcasting programming on an additional channel, Quality TV (QTV) and through the company’s subscription-based international channel, GMA Pinoy TV. It plans to launch a second international channel this year.

QTV was developed in partnership with Zoe Broadcasting Network Inc. and is the first TV station in the country specifically tailored primarily to middle-to-upper class female viewers.

GMA Pinoy TV was first aired in April 2005 and is currently shown in the United States, Japan, Guam, Saipan and Papua New Guinea, the Middle East and North Africa.

As of end-2006, GMA Pinoy TV had approximately 126,054 subscribers.

GMA also produces movies through GMA Films. Aside from this, it produces and broadcasts radio programs in 16 cities and one municipality across the Philippines on its wholly-owned operating network of 25 radio stations.

GMA intends to maintain its lead in total day TV ratings in mega-Manila through the launch of credible news, public affairs and quality entertainment programs and the refinement of its programming to attract and retain the audiences desired by advertisers and to boost profitability.

 

http://www.philstar.com/philstar/NEWS200705010702.htm

050107: By the rule: Lopezes to 'invest' P4.97B in City Resources

BEPRES Holdings Corp., First Gen Corp., First Philippine Holdings Corp. and ABS-CBN Holdings Corp. have at least three things in common. One, as their corporate identities suggest, they are all holding companies. Two, the Lopezes are their majority stockholders, who own shares through their corporate vehicles. And three, they are listed on the Philippine Stock Exchange (PSE). These similarities also apply to another Lopez-controlled company, but which has long been missing from the PSE board. The name of the company, City Resources Corp., may not be a familiar name among new market investors. But not to a few investors such as Ateneo Scholarship Foundation Inc., which still holds 914,667 CRC shares, and stockbrokers and their clients, who have been stuck with their CRC shares since 1994 and had probably forgotten everything about them. These small investors own a total of  7,979,840 shares of 95 million outstanding and issued shares of City Resources. As majority stockholders, the Lopezes own 87,020,152 shares, or 91.60 percent of 95 million outstanding CRC shares. These are listed in the name of Time Engineering Berhad, a Malaysian firm, as record stockholder, but of which Lopez  Inc. is the beneficial stockholder. Lopez Inc. is the family’s unlisted holding company, which, in turn, “is owned by the respective holding companies of the families of Oscar M. Lopez, Manuel M. Lopez and Presentacion L. Psinakis.”   * The good news. The ownership of the Lopezes over 87,020,152 CRC shares resulted from a purchase agreement dated December 27, 1996 covering 7,515,850 fully paid shares of Starfields Holdings Inc. and 79,504,310 shares held by Time Engineering Berhad, including those held by nominees. Here is the good news to the public stockholders who hold the equivalent of 8.40 percent of outstanding shares: They may want to sell their CRC shares via a tender offer, which the Lopezes are planning to undertake after the annual stockholders’ meeting on May 11, 2007, which, if successful will make City Resources a 100-percent subsidiary of Benpres Holdings Corp. The tender offer price has not been decided yet. Before biting into this offer, they may want to think twice, or even longer, because their company will undergo rehabilitation and will soon acquire assets that will make it a holding company that it really is and should be. Under a company-initiated rehabilitation plan, City Resources will get the assets it needs that are too valuable, in fact, for Ateneo Foundation to ignore by selling out to the either Benpres.  * Capital buildup. From mining as it prime activity, Manhattan Mining Corp. assumed a new corporate name to reflect its new business thrust. As a holding company, City Resources failed to take off and the trading of it shares was suspended. It was last traded on May 17, 1994,  when it closed at P8.50. To those who failed to beat the trading suspension and did not sell at P8.50,  the most welcome news is the plan of City Resources to raise its authorized capital stock to 5.4 billion shares at P1 par from 335 million shares. The capital stock expansion is intended to accommodate the subscription by the Lopezes to 4,969,670,636 shares paying them with 29,497,324 shares in another family-owned company. In a filing, City Resources said Benpres will pay its subscription to 2,435,579,607 CRC shares  with14,453,689 shares it owns in unlisted First Philippine Infrastructure Development Corp. while First Philippine Holdings Corp. will swap its 15,043,635 FPDIC shares with 2,534,091,029 CRC shares. The swap translates to P168.509 per share for Benpres’s FPIDC shares and P168.449 per share for FPHC-owned FPDIC shares computed at P1 par value of CRC shares. FPDIC, formed in 1994, is the Lopezes’ vehicle for road infrastructure projects in which Benpres owns 49 percent and FPHC, 51 percent. In turn, FPDIC owns 61 percent of Manila North Tollways Corp; 46 percent of Tollways Management Corp. and 100 percent of Luzon Tollways. Together, Benpres and FPHC will “infuse” P4,969,670,636 in CRC shares. The subscribed shares of the two holding companies will raise the outstanding shares of City Resources to 5,064,670,636 shares leaving 335,329,364 shares for future issuances. The question is: Are the Lopezes reserving these for CRC’s small shareholders should they be allowed to exercise their preemptive rights?

 

http://www.businessmirror.com.ph/05012007/companies05.html

050107: Philippine stocks drop on slower US economy

By Luzi Ann Javier

Bloomberg

Philippine stocks fell on concern slowing economic growth in the US may cap demand for exports from the Southeast Asian nation. Ayala Corp. led the decline. “Investors are not comfortable with a slowdown in the US economy,” said Jonathan Ravelas, market strategist at Banco de Oro in Manila. “That will have an impact on our exports and consumer spending.” The Philippine Stock Exchange index lost 47.65, or 1.4 percent, to 3270.73 at the noon close in Manila. Losers outnumbered gainers, 68 to 35, with 56 stocks unchanged in the broader market. The economy in the US, the Philippines’ biggest export market, expanded at an annual rate of 1.3 percent in the first quarter, the US Commerce Department said on April 27. That’s the slowest pace in four years. Ayala, the fourth-biggest listed company, fell P15, or 2.4 percent, to P600. Its unit Ayala Land Inc. dropped 75 centavos, or 4.1 percent, to P17.50. Megaworld Corp., one of the nation’s two biggest builders of residential and office towers, declined 20 centavos, or 5.8 percent, to P3.25. Concern by some investors that the government may borrow more than planned to finance its budget deficit also contributed to the decline in stocks. “It’s a crowding out effect,” said Jose Vistan, head of research at AB Capital Securities Inc. in Manila. “If the government borrows too much, the cost of borrowing for companies will go up.” The Philippine government’s net borrowings for the first quarter exceeded its target by P1.93 billion, according to news reports, citing Department of Finance data. Philippine Long Distance Co., the nation’s biggest company by market value, dropped P15, or 0.6 percent, to P2,540. The company plans to refinance about $100 million of debt with new peso borrowing after the elections, chairman Manuel Pangilinan said on March 7.

 

http://www.businessmirror.com.ph/05012007/companies02.html

043007: Stock market strong, seen testing highs

 

 

By EDU LOPEZ Given the generally positive market indicators such as strong value turnover and sustained buying support from foreign fund managers, the equities market is likely to test the year’s high at 3417 points. The market continued to show strength, posting a gain of 40 points on Friday following the gains from Ayala Corp., SM, Petron Corp. and Manila Water, says BPI Securities. AB Capital Securities expects the PSEi to have a strong resistance at the 3,400 level. "It is firmly moving within its uptrend line but close to 20 percent above its 200 day moving average and continues to show negative divergence with its momentum oscillators." The local equities market tried to make a run last week but lost steam. The record close of the Dow pushed the local index to 3,350 but failed to pull it up to the 3,400 psychological resistance, says AB Capital Securities. "Inflationary worries seemed to have eased while global economies showed signs of continued strength. Locally, the main concern is that of domestic interest rates, which seems to be bottoming out." "The disappointing fiscal deficit data and changes in the BSP tiering are seen to put pressure on the money markets. The threat of rising rates will most likely take its toll on the interest rate sensitive sectors like the property and construction sectors," says AB Capital Securities. Philnare also made its debut in the PSE last Friday, posting a strong performance in the first minutes of trade. The issue reached a high of P5.00, up 32 percent from its initial public offering (IPO) price of P3.80 before falling to lower levels. The weakness was brought about by the overall market’s correction of more than 30-points last Friday, says AB Capital Securities. "The PSEi remained on track to achieving a new high as share prices posted a strong week despite a late correction. The index has persistently breached the 3,320-mark, nearing its year high established just before global markets collapsed last February 28," says AB Capital Securities. On a week-on-week basis, the index gained close to 2 percent, going up in tandem with global markets. AB Capital Securities says that the only significant catalyst that brought the index to a 2-month high was the Dow’s convincing rise above the dreaded 13,000-mark. "This event overshadowed the more jolting announcement of a first quarter Philippine budget deficit announced last Monday. The budget deficit of P52 billion was reportedly 14 percent higher than the government’s target, raising concerns on the full year budget."

 

http://www.mb.com.ph/BSNS2007043092958.html

043007: PSE to ask SEC for more time to reduce shareholdings of brokers

 

 

The Philippine Stock Exchange intends to ask the Securities and Exchange Commission to again give it more time to look for a way to whittle the shareholdings of stock brokers in the bourse down to the 20 percent ownership cap imposed by the Securities Regulation Code for each industry group. "The PSE board has already done everything that it can to facilitate the sale of more PSE shares but unfortunately, we were not able to get shareholder approval for the waiver of their pre-emptive rights," said PSE president Francis Lim. He explained that the waiver would have allowed the PSE to seek out investors willing to make a strategic investment in the board without fear of having their intended stock acquisition blocked by shareholders exercising their pre-emptive rights. "We cannot force the brokers to sell their PSE shares as this will be interfering with their rights of ownership," said Lim adding that "it will be very cruel for the SEC to penalize us for failure to comply with the ownership cap since we have done everything we can." SEC chairperson Fe Barin agreed that no one can legally force stock brokers to part with their shares in the PSE but held back from commenting on whether the PSE will get another extension since the deadline expires in July. "We will have to review their performance to see what they have done so far," Barin said. PSE chairman Jose Vitug said earlier that the bourse failed to get the approval of the required twothirds of all outstanding shares for the removal of the pre-emptive rights of PSE shareholders. He blamed this partly on the low voter turnout of 70 percent explaining that since two-thirds of all shares are required to approve the amendment, the 21 percent who did not attend the meeting were automatically deemed to have cast their vote in the negative. Vitug pointed out though that the board enjoys the confidence of a majority of PSE shareholders as the proposal to remove the pre-emptive rights actually secured the approval of a majority of 7.34 million shares while only 3.95 million shares opposed the measure. Shareholders led by former Ramon T. Garcia questioned the proposal to remove the pre-emptive right of shareholders pointing out that it is an inherent right of all shareholders. He proposed to defer deciding on the measure but it was later decided to put it to a vote and let all shareholders decide on the issue on their own. Lim said shareholders who opposed the amendment are hesitant to allow a permanent or blanket removal of their pre-emptive rights but would rather have the board seek their approval for specific instances when the PSE will sell its shares.

 

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