THE Board of Investments (BoI) said it approved Dutch retailer Mulgrave Corp. BV’s application to invest in Rose Pharmacy, Inc., amid plans to take up a majority stake in the Cebu-based chain.
In a statement Thursday, the BoI said Mulgrave hopes to take its stake in Rose Pharmacy to 51% from 49%.
Rose Pharmacy has 252 branches nationwide.
BoI Managing Head Ceferino S. Rodolfo said that Mulgrave also expressed its intention to invest more to expand its operations in the Philippines.
“The BoI is seeing increasing interest of foreign investors in the Philippines to access the expanding domestic market,” he added.
“This reflects the sustained confidence of foreign investors in the country’s economy.”
In a separate statement, Rose Pharmacy said Mulgrave’s stake remains at 49% and described the BoI approval a “pre-qualification certificate.” It added that no agreement for a stake increase is currently in place.
Citing Bangko Sentral ng Pilipinas data, the Philippines received $7.9 billion worth of foreign direct investment in the first 10 months of 2017, up 20.5% higher year on year.
Mulgrave, a unit of Hong Kong’s Dairy Farm International Holdings, Ltd., the retail arm of Bermuda-registered trading firm Jardine Matheson Group, has prequalified to enter the market as a foreign retailer under the Retail Trade Liberalization Act.
The company operates supermarkets and hypermarkets, restaurants, and other retail brands in Asia such as Wellcome, Cold Storage, 7-Eleven and Ikea.
In the Philippines, Mulgrave owns a part of Rustan’s Supermarkets, Shopwise, and General Nutrition Center.
The Retail Trade Liberalization Act is intended to heighten market competition, driving down prices and at the same time ensuring better goods and services to consumers.
To qualify for BoI approval, a foreign retailer needs a five-year retail track record with at least five retail branches overseas, among others.
These companies are also required to have a minimum paid-up capital of $2.5 million. — Anna Gabriela A. Mogato
This item was updated to reflect the following statement issued by Rose Pharmacy in response to this story. The statement in full reads as follows:
“We are aware of recent reporting regarding an increase in Mulgrave Corporation B.V.’s shareholding in the Company to 51%. The Company can confirm that Mulgrave’s interest remains at 49% and understands that there is no agreement to increase its interest at this time. It is understood that Mulgrave holds a BOI pre-qualification certificate allowing it to increase its shareholding should such an opportunity arise. However, Mulgrave has no agreement to increase its shareholding in the Company at this time.”