Coal Asia to exit mining, backdoor list as Tubig Pilipinas in PHP 6.6-B water pivot

Coal Asia Holdings Inc. is set to leave the coal business and pivot into water services following a major ownership restructuring, Insider PH reports.

The listed firm agreed to sell 28.67 billion shares, or 71.68% of its stock, effectively transferring control to Pure Energy Holdings Corp. and its water-focused subsidiaries. The company will now concentrate on water distribution, bulk supply, sewage, and related services.

The transaction is an internal restructuring among companies owned by tycoon Dexter Tiu.

To signal its new direction, Coal Asia will rename itself Tubig Pilipinas Holdings Inc. Its board also approved increasing authorized capital to PHP 13 billion from PHP 5 billion to fund the transition.

Instead of cash, Coal Asia will issue new shares to Pure Water Corp., Quad Water Corp., and, pending approvals, CEF2 AO9 B.V. in exchange for their ownership in Tubig Pilipinas Group Inc. The share swap values the group at up to PHP 6.64 billion, based on a reference price of PHP 10.51 per share, subject to final valuation.

The Philippine Stock Exchange classified the transaction as a backdoor listing due to the substantial change in ownership and business focus. Consequently, trading in Coal Asia shares, valued at PHP 0.028 each, has been suspended until all regulatory requirements are met.

How will this exit from coal and pivot to water impact investors and the local mining sector? Share your thoughts.

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