PXP ENERGY CORP. is raising P7.11 billion from the subscription of its shares by affiliate Philex Mining Corp., and a holding firm owned by businessman Dennis A. Uy.

In a disclosure on Thursday, the crude oil and natural gas explorer said its board of directors had approved the subscription by Uy’s Dennison Holdings Corp. to 340 million common shares at a price of P11.85 per share.

The quoted price per share represents a 20% discount to the 90-day volume weighted average price of the company’s shares subject to the execution of a definitive subscription agreement.

The board has also approved the subscription by Philex Mining to 260 million common shares of PXP Energy under the same terms, subject to the execution of a definitive agreement.

“PXP intends to use the proceeds it expects to raise from the private placement to Dennison and Philex to fund its exploration activities and other oil assets within the Philippines and in Peru, and to repay its advances from Philex,” said the company, which has interests in various petroleum service contracts in the Philippines and Peru.

The combined shares subscribed to by Dennison and Philex Mining amount to 600 million, for a total subscription price of P7.11 billion at P11.85 per share.

In a previous disclosure to the stock exchange, Dennison was described as a domestic company beneficially owned and controlled by Mr. Uy.

PXP Energy said Dennison had signed with it a non-binding term sheet on Thursday.

“Details of the transaction will be disclosed upon execution of the definitive subscription agreement,” it said.

“After the subscription of Dennison and Philex to the foregoing shares, Dennison will have a total ownership interest in PXP of 14.78%, while Philex will increase its shareholding in PXP from 19.76% to 25.91%,” it added.

On Thursday, shares in PXP Energy jumped 7.32% to close at P17.60 each. Philex Mining gained 7.69% to P3.50 each.

Mr. Uy is the president and chief executive officer of Phoenix Petroleum Philippines, Inc., which disclosed in June that it had signed a memorandum of understanding with a unit of China National Offshore Oil Corp. (CNOOC) to develop a receiving terminal for imported liquefied natural gas (LNG) in the country.

PXP Energy directly and indirectly owns 77.5% of Forum Energy Ltd., a London-listed company whose main asset is a controlling interest in offshore exploration Service Contract (SC) 72 west of Palawan island in the disputed West Philippine Sea.

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