MANILA, Philippines - The SM Group of Companies is planning to list its unit in charge of its China mall operations within the next five years, according to a top company official.
“We may list our China subsidiary when we achieve critical mass. I think we can list when we have 10 malls already in China. We’ re looking at a five-year horizon, “ SM Investments Corp. (SMIC) chief finance officer Jose T. Sio said yesterday.
The SM Group, through SM Land (China) Ltd. currently owns three malls – SM Xiamen, Jinjiang and Chengdu. Targeted for opening in the next three years are malls in Chonggqing, Suzhou, and Zibo.
Suzhou, with a gross floor area of 73,000 square meters, is under construction and is expected to open early 2010. Zibo and Chongqing, which has the biggest population in China, are scheduled to open in 2011 and 2012, respectively.
The SM malls in China contribute five percent to total revenues and two percent to net income of SM Prime Holdings Inc., the country’s largest shopping mall operator.
Revenue contribution of the China malls are expected to increase to 10 percent by 2013 to 2014, SM Prime officials earlier said.
In addition, Sio said SM Development Corp., the real estate development unit of SMIC, may also raise funds through listing overseas next year and possibly a follow-on offering in the third quarter of next year depending on market conditions.
SM Prime will end the year with a total of 41 malls nationwide by end-2010 with total gross floor area of 4.8 million square meters or 6.2 percent higher than the estimated 2009 GFA of 4.5 million square meters. Its malls currently have a foot traffic of over 2.5 million per day.
Among the sites identified for mall construction next year are Calamba, Laguna; Masinag, Antipolo; Tarlac, Novaliches and San Pablo, Laguna which are expected to provide 279,228 square meters in total gross floor area.