AGI launches P5B share repurchase program
Alliance Global Group Inc., the investment holding company of tycoon Andrew Tan, has approved a plan to buy back as much as P5 billion of its shares over a two-year period.
A company can repurchase its shares from the local market if management thinks the shares are undervalued. It is one way for companies to enhance the value of the their stocks and boost trading liquidity.
AGI closed at P15.06 Tuesday, up 2.03 percent from Monday.
“We are undertaking this corporate action because we believe that our shares are grossly undervalued. Our group has been consistently profitable, with attractive growth prospects, and enjoys strong brand equity and therefore views this exercise as a means to enhance shareholder value over time,” said AGI president Kingson Sian.
Last year, AGI reported a six percent growth in net income on revenues of P139.6 billion.
The company has earmarked P80 billion for capital expenditures this year, of which 75 percent will go to the continued development of residential, office and commercial projects. Over 10 percent will be used to fund the expansion of the group’s leisure and gaming unit Travellers International Hotel Group while the balance will go to hard liquor subsidiary Emperador Inc. and the continued rollout of McDonald’s stores in the Philippines.