Chelsea allots P4 B for acquisitions

MANILA, Philippines -  Chelsea Logistics Corp. of businessman Dennis Uy is spending P4 billion to acquire other shipping and logistics companies as it eyes to establish for the first time a presence in the Asian region.

The company posted a net income of P132 million last year, a 35 percent jump from 2015’s P98 million as sales grew 16 percent to P2.9 billion from P2.5 billion.

It expects growth to continue as the company has laid down several strategies to sustain growth.

It plans to “acquire medium-range tankers to capture the regional shipping markets.”

At present, the company accounts for a 14 percent share in tanker capacity in terms of gross registered tonnage and a leader in the RORO and passenger market with a 32 percent share.

It also plans to acquire larger RORO and passenger vessels and optimal sized tanker vessels and expand its tug operations to improve efficiency and profitability.

The company is also expanding into new routes and is eyeing to acquire or upgrade ports, port equipment and facilities, machineries as well as shipyard.

Funding for these growth plans would come from Chelsea’s planned initial public offering (IPO) targeted in July.

Of the estimated net proceeds of P7.6 billion, the company would spend P4 billion for the acquisition of other shipping and logistics companies and P2.73 billion for the acquisition of new vessels and other equipment.

It plans to sell up to 546 million primary shares at a maximum price of P14.63 each. It tapped BDO Capital & Investment Corp. as issue manager, book runner and lead underwriter.

Chelsea has become the country’s largest shipping group since starting its business through Chelsea Shipping Corp. to support the operations of affiliate Phoenix Petroleum Philippines Inc. in 2006.