Ferronoux (FERRO), a dormant holding company and thus a viable backdoor listing target for businesses looking to skip the usual initial public offering process, confirmed an InsiderPH report on ongoing negotiations with investors.
“[W]e have been actively engaging in discussions with several potential investors who have expressed their strong interest in supporting the growth and expansion of our business,” the company said in a news clarification on Friday.
“These discussions are part of our overarching strategy to fortify the company’s market position and boost its future potential,” it added.
Open to a sale
“At this stage, although we are in negotiations with multiple parties, no final agreements or commitments have been made,” the company said.
“We remain open to exploring all strategic options, including the potential sale of the company, provided such a proposition aligns with the best interests of our shareholders and offers a compelling value proposition,” it added.
Deal expert’s view
“Ferronoux has been practically dormant since it was taken over by ISOC Holdings as the latter’s supposed backdoor entry never materialized,” Juan Paolo Colet, managing director at China Bank Capital, told InsiderPH.
“If a sale pushes through, the hope is that the new owners would have a clear business and value creation plan for Ferronoux,” he said.
What happens next?
It’s more about who comes next that will determine the future of Ferronoux, which was previously known as AG Finance Inc. when it was established in 2001 as a salary loan business.
Based on its annual report in 2023, current assets amounted to P1.89 million, although it lists P152.4 million in non-current assets, which are “due from a related party.” Current and non-current liabilities amounted to P14.83 million.
Meanwhile, interest earnings for the year reached about P3.3 million, while net income amounted to P970,563.
Shell game
Dormant listed firms have been hot lately as acquisitive businesses—whether for backdoor listing purposes or long-term investments that can eventually be flipped—actively seek out dormant companies or those with minimal operations and assets.
On Friday, the owners of Okada Manila announced a deal to sell their dormant firm, Asiabest Group International Inc., to a consortium led by property developer PremiumLands Corp.
Cosiquien, through his privately-held ISOC Holdings, which operates in property, cold chain logistics, energy, and infrastructure, acquired Ferronoux seven years ago for this purpose but ultimately chose not to inject assets.
"We would like to see these listed shell companies come to life to attract more capital and spur activity in the local stock market," Colet said.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
