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Millennium Global expects P118.11-million equity this year
July 17, 2013
Written by Roderick L. Abad - Business Mirror
MILLENNIUM Global Holdings Inc. (MGHI) plans to bring its negative P6.89-million stockholder’s equity since March 31 to positive P118.11 million by the end of the year via subscription to its authorized capital stock.
The company told the Philippine Stock Exchange (PSE) in its disclosure that the initial shares at a cost of P125 million, or 25 percent of the P500-million increase in authorized capital stock—to be purchased by MGHI Chairman, President and Chief Executive Officer Michael Yang—will address the negative stockholder’s equity posted as of December 12, 2012, and March 31, 2013.
The subscription will cover 125 million shares with a par value of P1. Initial payment of the 25 percent of the subscription price, which is equivalent to P31.25 million, was made in July. The balance of P93.75 million is expected to be fully settled by the end of the year.
Pursuant to the delegated authority given by the stockholders on May 22, 2012, allowing the increase of the authorized capital stock from P2 billion up to P10 billion, the board of directors determined on June 27 to initially increase the company’s authorized capital stock from P2 billion to P2.5 billion.
Yang was, likewise, allowed to enter into negotiations and agreements with prospective investors and interested firms pursuant to the company’s plan of expanding its investments and business operations.
MGHI recently executed an investment agreement with Millennium Ocean Star Corp. (MOSC) to infuse P60 million as additional working capital for the latter’s trading business expansion. The said amount would come from the P125 million proceeds of the subscription to primary shares of the company.
Yang said this is a “trial” investment, although this could eventually increase depending on the outcome of MOSC’s expansion program. He noted that “once we see the good results and also our good relationship, we may convert it to shares so MGHI may become a part-owner of MOSC maybe this year or next year.”
MGHI has ongoing negotiations with several potential investors. It expects that definitive agreements will be reached with private placement investors by end of 2013 with regard to the P375-million remaining balance from the P500-million planned increase in authorized capital stock.
The holding company, said Yang, is also studying the prospect of going into the real-estate business next year.