ALLIANCE Select Foods International Inc. stockholders have approved a P660-million private placement by parent company Strongoak Inc. as part of a broader restructuring intended to address its accumulated deficit and strengthen its financial position.
At a special stockholders’ meeting on Thursday, shareholders representing 81.42 percent of the company’s outstanding capital stock approved the subscription of 6 billion common shares by Strongoak at P0.11 per share, subject to regulatory approvals.The company said it would issue the shares in connection with a planned increase in its authorized capital stock. Upon completion of the subscription, Alliance Select Foods expects to have approximately 8.5 billion issued and outstanding common shares, with about 6.5 billion authorized but unissued shares remaining available for future issuance.The stockholders also approved reducing the par value of the company’s common shares to P0.10 from P0.50. The move would reduce its authorized capital stock to P300 million from P1.5 billion, based on 3 billion common shares.The company said the restructuring was intended to strengthen its financial position, address its accumulated deficit and create additional capacity for future equity funding.The par-value reduction is expected to generate approximately $21.4 million in additional paid-in capital, which the company plans to apply against its accumulated deficit, subject to regulatory approvals and applicable accounting requirements.Stockholders also approved a subsequent increase in authorized capital stock to P1.5 billion, consisting of 15 billion common shares with a par value of P0.10 each, to accommodate the parent company’s subscription and leave room for future share issuances.The company will seek the necessary approvals and apply for the additional listing of the 6 billion subscription shares with the Philippine Stock Exchange.The meeting also approved amendments to the company’s articles of incorporation to reflect the capital restructuring and transfer its principal office from Ortigas Center in Pasig City to Valero Street in Salcedo Village, Makati City.A majority of minority shareholders present or represented at the meeting also waived the conduct of a rights or public offering, if required under PSE listing rules.Alliance Select shares surged P0.02, or 4.35 percent, to close at P0.48 each on Thursday.