Capital raising to resume after elections

MANILA, Philippines — The dearth of fund-raising activities in the stock market is expected to come to an end after the midterm elections in May with a number of companies poised to raise capital again, the Philippine Stock Exchange (PSE) said.

PSE president Ramon Monzon said there are many companies that are waiting to sell shares, but are holding off until after the elections to avoid any market uncertainty. 

“Many are waiting to go to the market, but they are waiting until after the elections,” Monzon said in a recent interview. 

Among those in the pipeline for preferred share sale are the P20 billion preferred share sale of San Miguel Corp.’s Petron Corp. and the preferred share sale of Dennis Uy’s Resorts Group Holdings Inc. which also deferred a planned follow on offer that was initially targeted to be implemented in February.

PH Resorts had the approval to sell up to 1.786 billion in common shares, with an additional option of up to 267.95 million shares. 

Monzon said these companies are likely to proceed with their share sale after the elections on May 13. 

For the initial public offerings, at least four companies are expected to brave the market this year after postponing their plans to go public in 2018.

These include Campos family-owned Del Monte Philippines Inc. (DMPI) which earlier scheduled its planned IPO in June 2018.

DMPI had already obtained the approval of the PSE, the Securities and Exchange Commission (SEC) and the shareholders for the planned IPO which would supposedly raise as much as P17.552 billion in net proceeds.

However, Del Monte Pacific Ltd. (DMPL), the parent firm, said DMPI has decided to defer the IPO because of prevailing market conditions at the time.

The company had planned to sell 587.437 million secondary shares at a price of up to P29.88 per share.

Another company that also postponed a planned offering last year is consumer electronics manufacturing giant Cal-Comp Technology (Philippines) Inc. The company was supposed to embark on a P6.77 billion IPO in the second half of 2018. 

The company is member of NKG, the largest Taiwanese investor in the Philippines. 

Another company which did not push through with its IPO this year is Fruitas Holdings Inc. (FHI), the food and beverage company. It is behind the popular Fruitas brand and it had planned to do a roughly P2 billion IPO in the latter part of 2018.

FHI is the market leader in the Philippine food cart business. At present, it carries well-known brands such as Fruitas Fresh From Babot’s Farm, Buko Ni Fruitas, Fruitas Ice Candy, De Original Jamaican Pattie and Juice Bar, Juice Avenue, The Mango Farm, Buko Loco, Johnn Lemon. Black Pearl, Shou, Friends Fries, and Halo-Halo Islands.

Overall, Monzon remains optimistic on the market. 

“The market is doing well. It has not gone up substantially but it is consolidating. The market is poised to grow this year,” he said.

The Securities and Exchange Commission said that when the timing is good, it would be able to increase the minimum public ownership requirement on all listed firms to 20 percent from 10 percent at present. 

SEC chairperson Emilio Aquino said the move would improve liquidity in the market.