Robinsons Retail Holdings, Inc. (RRHI) said Friday that it has bought back 315,309 million common shares from GCH Investments Pte. Ltd. for P15.77 billion.
RRHI, the listed retail holding company of the Gokongwei Group, said the shares represent 22.2 percent of RRHI’s common shares.
The shares were acquired at P50 apiece, 36.2 percent premium to the stock’s closing price of P36.70 before the deal was announced.
GCH is a subsidiary of DFI Retail Group (DFI).
The deal was done through a special block sale approved by the company.
DFI became a major minority shareholder of the company in 2018 when RRHI acquired 100 percent of Rustan Supercenters, Inc. (RSCI) through a share-for-share swap with DFI.
DFI later increased its stake to 20 percent by buying shares from the Gokongwei family and from the market.
RRHI said this buyback transaction is a strategic move to optimize capital allocation and create more value to its stakeholders.
Moreover, the ongoing share repurchase program reflects the company’s belief that current market prices do not fully reflect the underlying financial strength and long-term growth prospects of RRHI.
“DFI has been instrumental in RRHI’s growth over the last few years,” said RRHI president and chief executive Stanley Co.
“Our acquisition of RSCI in 2018 and Rose Pharmacy in 2020 from DFI has allowed us to enter the premium food retail business and expand our drugstore presence in the Visayas and Mindanao regions as we added The Marketplace, Shopwise, and Rose Pharmacy into our portfolio. This partnership has also paved the way for RRHI to become the exclusive distributor of DFI’s private label brands – Meadows and Guardian – in the country. For this, we are deeply grateful for the partnership we have forged with DFI through the years.”
Co said RRHI will continue to distribute the Meadows and Guardian brands in the Philippines will continue following this transaction.
“These brands continue to gain traction in the market, and are a testament to our shared commitment in providing consumers innovative and affordable options. We remain firmly aligned with our commercial objectives and look forward to strengthening this collaboration in the years to come.”
The acquisition price was agreed upon by RRHI and GCH. It considered current market conditions and other strategic factors.
RRHI used a mix of internal funds and external borrowings to finance the deal.
