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PHILIPPINES: Larger PPP Contracted Companies Given Greenlight for Public Listings

New regulations are to permit special purpose companies (SPC) incorporated in the Philippines by holders of a public-private partnership (PPP) contract or corporations with a PPP contract valued at five billion Philippine peso (US$97.5 million) or more to raise funds from the capital market. This will also allow a PPP company to list on the Philippine Stock Exchange (PSE) even if it lacks the currently-required three-year track record of commercial operation.

Despite these changes, the existing shareholders of a PPP company will not be allowed to make a secondary offering during the initial public offering (IPO). Further, before applying for any IPO, a PPP company needs to have begun commercial operations and have completed at least one phase of the project. In addition, once listed, a PPP company will be required to submit a business plan to the PSE outlining its plans for liquidation or a proposal for a new business at least three years prior to the scheduled expiry of its PPP contract.

The moves come as part of the government’s bid to source additional funding for several infrastructure projects recently launched under the PPP scheme. For further details, see PHILIPPINES: Major Projects Fast-Tracked in Bid to Restore Investor Confidence.

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