MANILA, Philippines - D&L Industries Inc., a manufacturer of customized food ingredients, has raised its public float by close to five percent as investors bought P700 million shares under the over-allotment option.
The newly-listed company, which is also into specialty plastic colorants and additives, said underwriter Maybank ATR Kim Eng Capital Partners Inc. exercised in full its over-allotment option in its role as stabilizing agent.
In the greenshoe option, Maybank ATR bough an additional 160.714 million common shares at the initial public offering (IPO) price of P4.30 per share for a total transaction value of P691 million.
“With the exercise, D&L Industries sold in its initial public offering a total of 1.23 billion new and secondary common shares for total gross proceeds of approximately P5.3 billion,†the company said.
D&L listed its shares in the local bourse on De. 12, 2012.
The firm’s public float is now at around 33.4 percent since, as previously disclosed, some members of the Lao family bought D&L shares from the market after the IPO.
D&L said the 160.7 million greenshoe shares are equivalent to 4.5 percent of D&L’s outstanding shares while the 1.07 billion IPO shares amounted to 30 percent of the firm’s issued capital.
In the IPO, the greenshoe option allowed majority shareholder Jadel Holdings Co. to sell up to 15 percent more shares to foreign investors in case of robust demand.
During the share sale last month, underwriter Maybank ATR said D&L’s IPO was two times oversubscribed here and abroad.
Jadel Holdings earlier said the greenshoe option will likely to be exercised as D&L shares are trading above its IPO price.
Shares of the company closed at an all-time high of P4.98 apiece last week on local purchases.
D&L marketed its shares as an indirect consumer play since 80 percent of its revenues comes from the food ingredients business while 18 percent comes from specialty plastics, with the bulk supplied to the automotive industry.
D&L Industries expects to record stronger sales this year as continuous economic growth translates to more consumer spending.
Consumer spending is seen to grow due to strong local economy, low interest environment, and the confidence of both local and foreign investors, said D&L executive vice-president Alvin D. Lao.
Lao added that the election season will also boost sales particularly for food.
D&L typically doubles it profits every four to five years and “we have the intention to maintain that,†Lao said, adding that growth can accelerate further.
Early this month, D&L unit D&L Polymer and Colours Inc. and Japan’s leading chemical engineering company Showa Denko K.K. signed an original equipment manufacturing agreement covering the compounding, manufacturing and distribution of Bionolle Starcla.