2GO Group, Inc. disclosed plans to merge with parent company Negros Navigation Corp., Inc. (NENACO).
In a regulatory disclosure, 2GO said that at the company’s annual meeting on April 5, stockholders approved the internal restructuring involving the merger of 2GO and NENACO, with 2GO as the surviving entity, subject to the final decision and approval of the terms of the merger by the Board of Directors.
2GO said the merger will “simplify the corporate structure and to develop efficiencies and economies within the group.” The merger is also in line with 2GO’s efforts to streamline operations, reduce costs, and increase shareholder value.
NENACO is engaged in domestic shipping operation and is one of the oldest domestic shipping companies in the Philippines. It owns 2.160 billion common shares in 2GO, amounting to about 88.31% of 2GO’s outstanding capital stock. NENACO is owned and controlled by KGLI-NM Holdings Inc., whose major shareholder is Negros Holdings & Management Corp.
Under the merger proposal, each NENACO stockholder will receive common shares of stock in 2GO using the exchange or swap ratio of 0.26 2GO share for every one NENACO share.
Some 1.455 billion 2GO shares will be issued in exchange for the 5.597 billion NENACO shares, including converted preferred shares.
The timetable for implementing the merger will be announced once the plan gets regulatory approval from the Securities and Exchange Commission, 2GO said. The two parties, however, expect to complete the transaction within the year.
During the same stockholders’ meeting, members of 2GO’s Board for 2017 to 2018 were elected. These are directors Dennis Uy, Frederic DyBuncio, Ma. Concepcion de Claro, Elmer Serrano, Chryss Alfonsus Damuy, and independent directors Francis Chua, Raul Rabe, Laurito Serrano, and Joseph Tan.
Damuy is currently the director, president, and chief executive officer of Chelsea Logistics Corp., which owns stakes in 2GO. SM Investments Corp., which also owns shares in 2GO, acquired last year a 34.5% stake in NENACO for $124.5 million.
