Calata president Joseph Calata said in a message to shareholders that the company's board of directors approved these transactions in a bid to protect the welfare of its minority shareholders.
This was after the PSE initiated a delisting procedure against the company because of multiple disclosure violations.
Calata admitted that the company, as a neophyte member of the PSE, struggled to comply with all the rigorous requirements of corporate regulators.
"Because it would appear that the company's lack of experience in effectively complying with strict regulatory regulations might compromise public shareholders' interest as a result of possible sanctions which may be imposed upon an erring listed entity, on August 17, 2017, the Board of Directors decided that it would be in the best interest of the investing public to welcome new management which shall inject a new but related line of business into the company," Calata said in a disclosure.
Millennium Global to buy
Millennium Global said in a separate disclosure to the PSE that it will acquire an 81% stake in Calata by subscribing to 2.5 billion shares from Calata's increase in authorized capital stock.
Millennium Global plans to use Calata to acquire the business of its subsidiary Millennium Ocean Star Corporation – a leading exporter and importer of seafood and aquaculture products in the local and international market. (READ: 13 face charges for 'manipulating' Calata share price)
Trading for Millennium Global shares were suspended for one hour from 1:30 pm to 2:30 pm on Thursday, August 17, to give shareholders time to digest the disclosure. Upon resumption of trading, the share price of Millennium Global closed higher by 17.1% to P0.280 per share.
The local bourse last July 22 initiated a delisting procedure against Calata for committing multiple violations of the PSE disclosure rules.
The PSE said Calata committed 29 violations of Section 13.1 of the disclosure rules from November 29, 2016 to June 20, 2017.
Section 13.1 provides that a listed firm should file within a 5-year period any direct and indirect ownership change of its directors and principal officers.
Calata also committed 26 violations of Section 13.2, which prohibits directors or principal shareholders of a listed firm from trading the company's stock when material non-public information is obtained and up to two full trading days after the price-sensitive information is disclosed.
Trading of Calata stock is currently suspended.
"The management of Calata Corporation has always maintained that it has the ultimate responsibility over the welfare of its public shareholders. With the entry of Millennium Global and Millennium Ocean's business, it is ensured that the public shareholders' interest and value shall continually be protected and enhanced," Calata said. – Rappler.com