MANILA – Shareholders of SM Prime Holdings Inc today approved a plan to consolidate Henry Sy’s property businesses under the shopping mall developer.

On the sidelines of the company’s special stockholders meeting, SM Prime chief financial officer Jeffrey Lim told reporters that unit heads of the SM Group’s different property firms will meet to craft an integrated development plan once the consolidation gets the go-ahead from the Securities and Exchange Commission (SEC).

The integrated development program — which will encompass the mall, residential, office, hotels, convention center and tourism segments — will also “give a flavor” of its planned capital spending, Lim said, referring to the group’s P60-billion spending plan for this year.

“Within six months to a year, we should be able to reprogram everything to come up with an integrated development plan,” SM Prime president Hans T. Sy said.

“Tapping the capital markets overseas will be an option for us but we have to sit down first and have an integrated expansion program for the enlarged entity. We can also tap the debt market because gearing will be low in the enlarged entity,” Sy, a son of the mall tycoon, said.

SM Prime shareholders on Wednesday also approved the doubling of the company’s authorized capital stock from P20 billion to P40 billion for the issuance of new shares and the amendment of its primary purpose to become a mixed-use real property developer.

Once the reorganization is completed before the end of the year, the enlarged SM Prime will become the biggest real estate firm in Southeast Asia. While the focus of its expansion will be the Philippines and China, the company will also look at opportunities in the region, Lim said.

The consolidation may also allow other property-related businesses to expand in China where SM Prime already has five shopping malls.

“It will be easier for SM Development Corp (SMDC) to expand in China because we’re already there,” Sy said, adding that it is in the final stages of negotiations for the acquisition of three to four properties in China.

Lim said shopping mall development will remain the core business of the enlarged SM Prime and will account for 60 percent of profit.

“The market will still be the Philippines but we have to look at opportunities in the region. But right now our focus is in China in terms of [overseas] expansion. The Philippines will still be our main market. Right now, China is contributing 10 percent to bottom line. In the enlarged entity, that contribution will even go down,” he said.

During today’s meeting, SM Prime shareholders approved a series of transactions amounting to P279 billion to complete the proposed consolidation.

SM Land Inc, the private holding firm of the Sy family, is conducting a tender offer to acquire shares in SMDC and Highlands Prime Inc in exchange for shares of SM Prime. SMDC and Highlands Prime have since moved to delist from the local stock market.

After the offer, SM Land will then merge with SM Prime with the latter as the surviving entity. SM Prime will then acquire specific real estate companies and assets of SM Investments Corp in exchange for new shares in the mall developer.