(UPDATED) - Developer 8990 Holdings, Inc. has begun the process of acquiring a Cebuano real estate company and its flagship project, a 200-hectare upscale mixed-use development in the hills of Cebu City, for around P1.1 billion.
The amount is roughly equivalent to the estimated project cost of a high-rise condominium in uptown Cebu City or a small mixed-use complex in the downtown area.
In a disclosure on Monday, March 18, 2019, 8990 Holdings said it will acquire the Villalon-owned Genvi Development Corporation through its subsidiary 8990 Housing Development Corporation. It expects to complete the transaction by the second quarter of 2019.
Genvi owns the largest and the last remaining contiguous property in the hills of Cebu City. It is the developer of Monterrazas de Cebu, a high-end residential and commercial project that is being developed in more than 200 hectares of the Villalon property.
This acquisition marks 8990 Holdings’ foray into the high-end property development sector. The company is behind the affordable housing brand Deca Homes and Urban Deca Homes.
In an amended statement on Tuesday, March 19, 8990 Holdings said it has completed the first phase of the acquisition with the signing of a Subscription Agreement on March 15, 2019 between 8990 HDC and Genvi.
Under this agreement, 8990 HDC subscribed to 2.9 million existing but unissued common shares of Genvi for P100 per share, or a total of P291.3 million. This was fully paid in cash.
This made 8990 HDC the owner of 72.83% of the total issued and outstanding capital stock of Genvi.
The remaining 27.17% equity held by Genvi stockholders will be acquired by 8990 HDC “following completion of continuing discussions with the current shareholders of Genvi and confirmation of due diligence findings.”
This phase involves separate share purchase transactions with the Genvi shareholders for a total estimated price of P800 million.
“The parties expect to complete such share purchase transactions sometime in the 2nd quarter of the year,” parent firm 8990 Holdings said in a statement.
The company announced the acquisition on February 20, 2019, saying it will allow the company to expand to other real estate segment.
The transaction will increase 8990 Holdings’ land bank to about 800 hectares.
As of 10:10 a.m. of March 18, 2019, 8990 Holdings shares were being traded at P12.14 apiece, higher than its close of P12.10 per share on March 15, 2019. (Ventures Cebu)