In a circular to the Philippine Stock Exchange, SPC said it will offer a total of 313.9 million common shares or 20 percent of its outstanding capital to the public from March 6-14, to be tentatively listed on April 2.
ATR-Kim Eng Capital Partners Inc., the issue manager and lead underwriter, has priced the offered shares at a range of P1.70 to P2.20 each, which translate to a price-earnings (P/E) ratio of between 4.3 to 5.6 times forecast 2002 earnings.
SPC is majority owned by Salcon Philippines Inc., a 60 percent subsidiary of Singapore’s Salcon Ltd., along with other foreign entities and local partners led by siblings Dennis and Larry Villareal, Alfredo Henares, Yolanda Martinez and Cora Gamez.
Aside from the development of power plants, parent firm Salcon Ltd. is engaged in a wide range of industrial projects such as palm oil mills, liquid storage tanks, water treatment plants, and waste water treatment plants.
It also has investments in power generation and distribution, water distribution, environmental engineering, and industrial and agro-industrial engineering.
SPC’s flagship and initial venture in the Philippine power industry is the 203.8 megawatt (MW) Naga Power Plant Complex in Cebu bid out by the state-owned National Power Corp. in 1994 for a 15-year rehabilitation, operation, maintenance and management (ROMM) agreement.
Since then, the company has extended its participation in other power projects in the country such as its acquisition of 40 percent of Mactan Electric Co., a power distribution franchise in Lapu-Lapu City, Olongapo and Cordova in Mactan, Cebu; another ROMM contract for the Bohol Provincial Electric System; a 5 MW generating facility in Samal Island, Davao under a joint venture with Davao del Norte Electric Cooperative; and the 29 MW Timbahan and 32 MW Villasiga hydro-electric power plants in Panay Islands.
The company said the proceeds of the IPO will be channeled to partly finance its investments in the $27 million (P1.4 billion) Eight Islands Diesel Project to be implemented by its wholly owned subsidiary Salcon Island Power Corp. (SIPC).
In Feb. 2000, Salcon Power successfully bid for the installation of diesel engine-driven power plants with an aggregate capacity of 50 MW (of between 5 MW to 15 MW) in a total of eight islands in the Philippines.
Projections in the company’s financial sheets point to a net earnings of P582.541 million on reveues of P1.2 billion for its fiscal year ending July 31, 2002.
SPC is the first in an expected flood of new offerings this year following a drought of IPOs last year. Although only four companies broke into the equities market in 2001 (SWL*Wizard, Primex Corp., Federal Chemicals and Citystate Savings Bank), their respective IPOs were all warmly received by the market. - Conrado Diaz