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Saturday, September 09, 2006
PSE urges Cebuano firms to become publicly listed
The Philippine Stock Exchange (PSE) is encouraging Cebuano companies to enlist with the PSE and gain the confidence of prospective investors.
This is one of the advantages of companies listed in the PSE, said Melchor Guerrero, PSE vice president and head of the capital markets development division.
Because of PSE’s “strict” disclosure rules, investors are confident they will be putting in cash to a legal company, he said.
Companies going public in an initial public offering (IPO) through the PSE, though, have to give up a certain percentage of ownership of their companies, Guerrero said.
An IPO means raising needed funds by selling equities.
Cebuano companies currently listed in the PSE include Cebu Holdings Inc., Cebu Property Ventures and Development Corp. (CPVDC), Aboitiz Equity Ventures and Waterfront Philippines.
Workers’ share
Aside from gaining confidence of investors, publicly-listed companies can also decrease turnover rate of employees by giving employees the incentive to own part of the company.
“This is what some call center companies are doing in Manila to encourage employees to stay,” Guerrero said.
He said the advantages in listing with the PSE outweigh the disadvantages, which include additional controls on management and additional costs to the company for listing and maintenance fees, among others.
Market indifference, as manifested in a low trading volume of a company’s stocks, is also one of the disadvantages to be considered.
As for the benefits, Guerrero cited the fast growth of Jollibee Foods Corp. (JFC), after its IPO.
JFC was listed in 1993 with a per share value of P9. As of June 5, its stocks closed at P34.50 per share.
The fastfood chain grew from 120 local stores and five stores overseas to 1,200 stores, including 120 outlets located abroad.
The PSE index is composed of 30 companies. It is used to measure the price of a fixed basket of stocks by a typical investor. (JBN)
For Bisaya stories from Cebu. Click here. (September 9, 2006 issue)
Write letter to the editor.Click here.
Join the Sun.Star message board.Click here.
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