8990 buys Cebu housing developer

Mass housing developer 8990 Holdings Inc. is acquiring a controlling stake in Cebu-based affordable housing builder Piccadilly Premier Land Inc. for P88.28 million.

In a disclosure to the Philippine Stock Exchange, 8990 said it has entered into an Investment Agreement with Piccadilly, RDAK Land, Inc., Acrissor Development Corporation, and certain individuals for the acquisition of 68 percent of the outstanding common shares of Piccadilly.

It added that the agreement comes with the understanding that RDAK and Acrissor will also sell identified assets and liabilities to Piccadilly.

Anthony Vincent Sotto, 8990 President and CEO, expressed his satisfaction with the closing of this Cebu acquisition, considering that Cebu remains one of 8990’s main markets.

*8990 President & CEO Anthony Vincent Sotto*

“While it is too early to tell how much this acquisition will contribute to our revenues, we are excited and optimistic with this transaction. Their existing portfolio of affordable-priced projects is expected to complement our current slate of projects and broaden 8990’s reach in property development,” Sotto said.

The transaction is a share sale transaction which involves a transfer of assets and liabilities from RDAK and Acrissor to Piccadilly, and the transfer of real estate assets by certain individuals to Piccadilly.

The acquisition involves a total of 994,160 common shares of Piccadilly at P88.79 per share consisiting of 438,910 shares owned by RDAK and 555,250 shares held by individual shareholders.

The amount of P44.14 million or 50 percent of the total purchase price shall be payable upon execution of the Investment Agreement while the remaining 50 percent shall be paid upon issuance by the Bureau of Internal Revenue of the Certificate Authorizing Registration of the shares purchased by 8990 from the various selling shareholders.

It also hinges on the execution of the Joint Venture Agreements for Guba, Bayanihan Flats Mactan 1, and Bayanihan Flats Mactan 2, execution of Deeds of Transfer of various assets.

Piccadilly, RDAK, and Acrissor are all property developers which have successfully completed affordable-priced projects in Cebu City.

“The transaction is expected to broaden 8990’s reach in property development by investing in a company with existing portfolio of affordable-priced projects,” 8990 said adding that it is expected to expand the company’s footprint in property development.

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The article was originally published in Manila Bulletin and written by James A. Loyola.