The Social Security System (SSS) has bought an initial 2.83 percent stake in independent oil company Phoenix Petroleum for P42 million.
In a disclosure to the Philippine Stock Exchange, Davao-based Phoenix Petroleum said it has signed a Subscription Agreement with SSS for the purchase of up to 10 percent of the company’s outstanding capital stock.
Phoenix said for the initial tranche, SSS has subscribed a total of 7,500,000 common shares at P5.60 per share, representing about 2.83 percent of the outstanding capital stock at present.
The Subscription Agreement will be valid for one year from the date of execution, with an undertaking not to dispose, transfer or sell the subscribed shares for a period of six months from the date of purchase.
“There is no guaranty that subsequent primary issuances to the SSS, if they pursue any further purchases, would bring the aggregate purchases to the agreed-upon ceiling. Any prospective number of shares to be subscribed would depend on market conditions and will entirely be at the discretion of the SSS,” Phoenix Petroleum said.
The company earlier said it was eyeing strategic business partners and financial investors to help them become the number one independent oil company.
“At this juncture, Phoenix Petroleum is open to engaging prospective business partners who will participate meaningfully in our next stage of growth,” Phoenix chief financial officer Francis Caluag had said.
He said the capital infusion from partners will be used for additional working capital needed to support the expansion of the company’s retail distribution network.
“Phoenix Petroleum would like to take advantage of the growth opportunities obtainable from building additional depots and retail stations nationwide in line with our objective of being the leading independent station in retail,” Caluag said.
“We are conscious of our gearing as we grow the business and we want to ensure that we have sufficient liquidity for both current operations and for capital spending. With our expanded network, we also need to ensure a reliable supply of quality fuel and this requires us to diversify our fuel procurement from both domestic and regional sources,” he said.
Phoenix Petroleum is engaged in the trading of refined petroleum products, lubricants, chemicals and an array of car care products and accessories. The company also provides services such as depot operation, depot storage, logistics, into-plane and allied services.
It was listed on the Philippine Stock Exchange in July 2007, the first petroleum company to do so since the passage in 1998 of the Downstream Oil Deregulation Act.
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