IPO-bound Datem expands in Southeast Asia

MANILA, Philippines - Datem Inc., the soon-to-be-listed local construction company, is gearing up for expansion in Southeast Asia, establishing its first foreign venture in Vietnam as it hitches a ride on the booming economy in the integrating region, its top official said.

In an interview, Datem president Levy Espiritu said the company has set up Datem Water Vietnam for expansion in the Southeast Asian country and is looking at other prospective partners in Myanmar and Cambodia.

“In Vietnam, we’re trying to look for a strategic partner. We are in talks with two prospective local partners,” Espiritu said.

Datem Inc.’s core business is construction, but in 2013 it expanded in related industries such as housing and bulk water treatment through subsidiaries Datem Homes and Datem Water.

In Vietnam, Datem Water is looking to provide water treatment services around the country including in major cities such s Ho Chi Minh and Hanoi.

Other possible sites for expansion in the region are booming economies Myanmar and Cambodia, Espiritu said.

“The key there is to get a reliable group or local partner,” he said.

He said expanding in Southeast Asia is strategic given the ongoing integration of the 10-member Association of Southeast Asian Nations (Asean).

“As a company, we’re ready for Asean integration. Other firms are already coming to the country and we’re also doing that. With respect to skilled labor, technical professionals, we have an edge because of English proficiency,” Espiritu said.

To partner with local firms, he said it is important to be a listed company in the Philippines as prospective partners look into good corporate governance practices.

“Now, to partner with these firms, in the Asean region, it’s important also that you are listed,” Espiritu said.

Thus, Datem is gearing up for its planned P4.6 billion initial public offering (IPO) in mid-November.

Last month, Datem formally filed with the Securities and Exchange (SEC) an application to list 329,046,263 shares with an offer price of up to P14.15 per share.

The offer consists of up to 286,127,185 firm shares and 42,919,078 optional shares pursuant to an over-allotment option, according to the company’s application.

“Definitely there won’t be a change in the plans because we’re really very bullish on the growth of the infrastructure industry. And there are  businesses related to construction. For the past years, the economy has been growing tremendously and the construction industry has been contributing a big percentage of the growth for a number of years now,” Espiritu said.

To date, the company has partnered with top property developers for various projects.

“We have 24 ongoing projects,” Espiritu said.

These include Alphaland Makati Place, composed of three residential and office towers; Arthaland’s two-tower Arya Residences; De La Salle University’s new Rufino Campus; Federal Land Inc.’s 47-storey Grand Hyatt tower; Megaworld’s One Uptown tower, Two Central residential building and Venie Grand Canal Mall and Global Estate Resort’s Savoy Hotel in Boracay.

Its past projects include Discovery Primea, a luxury residential tower in Makati; Discovery Shores in Boracay and the Mind Museum, the Philippines’ first world-class science museum and a LEED Gold-certified building for design and construction.

For its water subsidiary Datem Water, Inc., it has a 15-year bulk water supply contract with Metro Kalibo Water District and is looking at other provinces to expand the business.