RRHI reacquires 22.2% stake from DFI in P15.77B deal

RRHI reacquires 22.2% stake from DFI in P15.77B deal | Daily Tribune

Robinsons Retail Holdings, Inc. (RRHI) has taken a significant step toward regaining greater control of its future by repurchasing 315,309,310 common shares, representing a 22.2% ownership stake, from GCH Investments Pte. Ltd., a subsidiary of DFI Retail Group. The transaction, completed via a special block sale on the Philippine Stock Exchange, was priced at P50 per share, totaling approximately P15.77 billion. This represents a 36.2% premium over RRHI’s market price of P36.70 per share before the sale.

The bold move drew a positive market response, with RRHI shares rising nearly 8% during Friday’s morning session. The stock later settled at P37.95, up 3.41% from the previous day.

GCH Investments is owned by DFI Retail Group, formerly known as Dairy Farm International. DFI became a significant minority shareholder of RRHI in 2018, when Robinsons Retail acquired a 100% stake in Rustan Supercenters, Inc. (RSCI) through a share-for-share swap transaction. DFI subsequently increased its stake in RRHI by purchasing secondary shares from members of the Gokongwei family and other investors.

“DFI has been instrumental in RRHI’s growth over the last few years,” said RRHI President and CEO Stanley C. Co.

“Our acquisition of RSCI in 2018 and Rose Pharmacy in 2020 from DFI allowed us to enter the premium food retail business and expand our drugstore presence in the Visayas and Mindanao regions, as we added The Marketplace, Shopwise, and Rose Pharmacy to our portfolio.”

RRHI emphasized the significance of the buyback, noting it strengthens its capital base and asserts greater independence to pursue aggressive growth strategies. The company stated that the move reflects its belief that the intrinsic value of RRHI is not fully captured by current market prices, and it remains committed to unlocking this value for shareholders.

Despite the shift in ownership dynamics, RRHI confirmed that its exclusive distribution partnership with DFI’s private-label brands, Meadows and Guardian, will continue without disruption, ensuring continued consumer access to trusted and affordable products.

“These brands continue to gain traction in the market and are a testament to our shared commitment to providing consumers with innovative and affordable options,” Co added.

The transaction was funded through a combination of internal resources and external borrowings, in line with RRHI’s broader capital optimization strategy.

“RRHI views this buyback transaction as a strategic move to optimize capital allocation and create more value for its stakeholders,” the company said in its disclosure.

“Moreover, the ongoing share repurchase program reflects the company’s belief that current market prices do not fully reflect the underlying financial strength and long-term growth prospects of RRHI.”