PSE Nears 97% Ownership of Philippine Dealing System Holdings Corp.

Strategic Insights -

The Philippine Stock Exchange Inc. (PSE) is close to acquiring a 97% stake in the Philippine Dealing System Holdings Corp. (PDS) through a series of acquisitions. The PSE aims to integrate the PDS into its operations to align the Philippine capital market with global standards. PSE president and CEO Ramon Monzon said that the acquisition will enable the PSE to fully realize synergies, efficiencies, and risk management benefits.

Key Takeaways:

  • The PSE's current ownership in PDS stands at 91.32%, with a target of acquiring an additional 5.28% from Development Bank of the Philippines (DBP) and Land Bank of the Philippines.
  • DBP owns 192,776 shares, representing a 3.08% stake in PDS, while Land Bank holds 134,372 shares or 2.15%.
  • Upon acquiring DBP and Land Bank's shares, the PSE's stake in PDS will increase to 96.55%.
  • The PSE secured SEC approval for exemptive relief in December 2023, allowing it to exceed the 20% ownership limit in the PDS Group.
  • Post-acquisition objectives include the seamless integration of PDS and PSE entities to realize synergies, efficiencies, and risk management benefits.
  • The PDS owns the Philippine Depository and Trust Corp., which serves as the depository for equities and fixed income securities.
  • Member banks of the Bankers Association of the Philippines are eyeing a 49% stake in PDEx as part of the sale of the group's shares in PDS to the PSE.

Statistics:

  • 96.55%: The PSE's anticipated stake in PDS once DBP and Land Bank's shares are acquired.
  • 3.08% and 2.15%: DBP and Land Bank's current respective stakes in PDS.
  • 91.32%: The PSE's current ownership in PDS.
  • 20.98%: The PSE's original equity interest in PDS.
  • 2023: The year the PSE secured SEC approval for exemptive relief in its acquisition of additional shares in the PDS Group.
  • 49%: The proposed stake that member banks of the Bankers Association of the Philippines intend to acquire in PDEx.
  • 1: The number of entities that will require SEC approval for exemptive relief for the proposed sale of the group's shares in PDS to the PSE.

Sources:

  • Ramon Monzon, PSE president and CEO, interview with The STAR
  • Philippine Stock Exchange Inc. (PSE) press release
  • Securities and Exchange Commission (SEC) approval for exemptive relief, December 2023
  • Philippine Dealing System Holdings Corp. (PDS) annual report
  • Bankers Association of the Philippines press release