MPI shareholders give green light to privatize<\/strong><\/p>\n\n\n\n In a special stockholders meeting, 77.72% of MPI’s stockholders on record approved the plan to conduct a tender offer and take Metro Pacific Investments Corp. (MPI) private. The plan involves a consortium, composed of HK-based First Pacific Group, Japan-based Mitsui & Co., Philippine-based GT Capital Holdings (GTCAP), and a private company controlled by MPI Chairman Manny Pangilinan, offering to buy at least 9,106,567,439 shares or 95% of the company\u2019s public float at P5.20 per share. The end result will be MPI delisting from the local bourse.<\/p>\n\n\n\n Our View: <\/strong>Say bye-bye to your MPI. While the percentage of shareholders approving the plan fell somewhat short of \u201coverwhelming\u201d, this second attempt to conduct a tender offer was not accompanied by as much grumbling about it being a lowball offer as the first one. <\/p>\n\n\n\n As such, we expect the consortium to reach its target number of shares since the P5.20 offer is 37% higher than the 52-week volume-weighted average of P3.80 per share. There are still some complaints that the offer price falls short of the consensus fair value estimate of P6.30 per share, but considering that MPI has been perpetually undervalued and has not come anywhere close the to the estimate in recent memory, it\u2019s unlikely that it will magically do so now. <\/p>\n\n\n\n Given the above, we recommend shareholders to subscribe to the tender offer.<\/p>\n\n\n\n The tender offer period starts August 9 and ends on September 7. The shares will be crossed on the Exchange on September 15, for settlement on September 19. MPI will effectively delist on October 9. <\/p>\n\n\n\n Following MPI\u2019s delisting, Bloomberry Resorts Corp. (BLOOM) is expected to replace it on the benchmark PSE index. BLOOM\u2019s float-adjusted market capitalization is slightly lower than MPI, which may result in increased index weights for the other index names upon its entry into the PSEi.<\/p>\n\n\n\n