MANILA, Philippines (As released) — The Yuchengco Group will put its insurance and property business under House of Investments Inc. (HI), to add to its current construction, education and renewable energy businesses.
It will also sell some shares from its construction business (EEI) to a strategic partner. The funds will be used to reduce its debt, strengthen its balance sheet and make it a stronger player.
Overall, the restructuring will make HI a more diversified conglomerate with the resources to take advantage of opportunities moving forward.
To effect the restructuring, HI will issue new shares in exchange for 77.32% of MICO Equities Inc., 51% of Sun Life Grepa Financial Inc. and 49% of Grepa Realty Holdings Inc. for a total consideration of P15.74 billion.
MICO Equities Inc. is the holding company of YGC that holds the investments in non-life insurance through Malayan Insurance Co. Inc. (MICO). MICO is one of the leading non-life insurance companies in the Philippines that is authorized by the Insurance Commission to underwrite the following: Aviation, Engineering, Fire/Property, Marine, Miscellaneous Casualty, Motorcar, Personal Accident, Residential Fire and Travel Insurance and Surety Bonds. It has an extensive network of 35 branches and service offices nationwide.
Sun Life Grepa Financial Inc. (SLGFI) is a joint venture between YGC and Sun Life Financial (Philippines), a top player in the Philippine Insurance Market for over 120 years. SLFGI provides financial planning and guidance, life and health products for every stage of life; investment, wealth accumulation, and savings products for individuals, families and corporations; insurance benefit offerings for companies and their employees.
House of Investments will acquire 41% of Grepa Realty Holdings Inc. (GRHI) expanding its property portfolio. The main asset of GRHI is Grepalife Building which stands on a 5,000 square meter land along Sen. Gil J. Puyat Avenue in Makati and will add to the property portfolio of HI which includes A.T. Yuchengco Centre, RCBC Plaza and the upcoming The Yuchengco Centre. GRHI also owns properties in Cebu, Antipolo, Tacloban, Manila and a lot in Carmelray in Calamba which is an industrial park classified as Special Economic Zone by PEZA.
At the same time, House of Investments is reducing its interest in the construction sector. HI will be selling 20% of EEI Corp. for P1.25 billion to RYM Business Management Corp. reducing its stake from 55.346% to 35.346%.
RYM holds significant investments in mining, real estate and media through subsidiaries and affiliates, namely: Bright Kindle Resources and Investments Inc., Marcventures Holdings Inc., Benguet Corp., Prime Media Holdings Inc. The opportunities in the construction sector can be best explored with a strategic partner. The proceeds from the sale will be used to reduce debt and increase investments in ESG initiatives.