THE Philippine Competition Commission (PCC) has approved DoubleDragon Corp.’s (DD) proposed acquisition of shares in MerryMart Consumer Corp., issuing its decision ahead of the Phase 1 review deadline.
In a statement on Thursday, the PCC said the DoubleDragon-MerryMart transaction is unlikely to substantially lessen competition, as strong rivals in upstream and downstream markets constrain input and customer foreclosure.
DoubleDragon develops real estate across retail, offices, industrial spaces, and hospitality, with subsidiaries CityMall operating malls nationwide and CentralHub managing warehouse complexes in the Philippines.
MerryMart runs a growing chain of supermarkets and convenience stores focused on consumer goods throughout the country.
“With this clearance, the PCC affirms its commitment to safeguarding competitive markets while ensuring that mergers and acquisitions proceed in ways that allow businesses to pursue growth opportunities that benefit consumers and the broader economy,” the commission said.
The PCC’s Mergers and Acquisitions Office reviewed how the deal might affect competition in leasing commercial spaces and warehouses to grocery and convenience stores in areas served by DoubleDragon’s CityMall and CentralHub.
It also examined upstream markets, such as space and warehouse supply, and downstream markets for those retailers.
“Consultations were conducted with key industry stakeholders, which include major retail chain competitors, customers, and relevant government agencies,” it noted.
In April last year, DoubleDragon announced plans to acquire a 35% stake in listed consumer and wholesale retailer MerryMart under a P1.28-billion deal.
Under the transaction, DD will buy 2.66 billion MerryMart common shares at 48 centavos per share from Injap Investments, Inc. The price was based on the 30-day volume-weighted average price (VWAP) of MerryMart shares. Half of the transaction will be paid using DD shares, while the remaining half will be settled in cash worth P637.97 million.
In April 2021, DD amended its articles of incorporation to change its primary purpose from a real estate developer to an investment holding company.
DD said in an earlier statement that the acquisition would also support its target of reaching P500 billion in revenue by 2035.
On Thursday, DoubleDragon shares rose 1.89% to close at P9.17, up P0.17. — Alexandria Grace C. Magno
