PSE okays Century IPO

MANILA, Philippines - Century Pacific Food Inc., the country’s largest canned goods producer, will become the second company to list in the local bourse through an initial public offering (IPO).

In a memorandum, the Philippine Stock Exchange (PSE) said its board of directors approved the P3.33-billion IPO of Century Pacific.

“We’re very optimistic about Century Pacific. It’s another play on the consumer growth and the growing income of Filipinos,” said Eduardo V. Francisco, president of BDO Capital & Investment Corp.

“The consumer market in the Philippines will continue to grow because of the rising gross domestic product,” Francisco said, adding that increased spending capacity allows consumers to shift to more expensive products like corned beef from cheaper sardines.

Century Pacific will list 2.22 billion common shares, of which 229.654 million shares will be offered to the public at a maximum price of P14.50 each that will raise as much as P3.329 billion.

The bulk of the IPO proceeds will be used to pay existing debts, with the remaining funds allotted for capital expenditures, potential opportunistic acquisitions and general working capital.

Francisco said retiring debts will immediately improve the profitability of Century Pacific. The company is being advised by Evercore Asia Ltd. while the offer will be underwritten jointly by BDO Capital, BPI Capital and First Metro Investment Corp.

The final IPO price will be set on Apr. 21. Offer period will run from Apr. 23 to Apr. 29, while the listing of the shares in the PSE is scheduled on May 6.

DoubleDragon Properties Corp. became the first firm to conduct an IPO this year while Top Frontier Investment Holdings Inc., the majority shareholder of diversified conglomerate San Miguel Corp., listed by way of introduction in January.

Century Pacific, the firm behind Century Tuna, Argentina and 555, is the Philippines’ largest producer of canned goods, cornering 84.1 percent of the domestic canned tuna market, 42.5 percent for corned beef and 25.6 percent for meat loaf.

“Over the last 35 years, Century Pacific has established a strong brand and product portfolio through, and supported by, continuous product innovation, brand building and acquisition of brands from third parties,” the company said.

The tuna manufacturer plans to strengthen its market leadership through new products and partnerships while venturing into new categories like coconut water and premium meat products.

Last year, profits of Century Pacific hit P690.29 million as net sales reached P19.06 billion.

Century Pacific started operations in 1978 when businessman Ricardo S. Po Sr. set up Century Canning. Other brands of Century Pacific include BlueBay, Wow, Birch Tree, Angel, Fresca, Lucky 7 and Shanghai.