Regulators approve IPO of Kepwealth Property Philippines

MANILA, Philippines — The Securities and Exchange Commission and the Philippine Stock Exchange have given the green light to Kepwealth Property Philippines Inc. to do an initial public offering.

In its July 23 meeting, the SEC en banc approved the registration statement of KPPI, a property management company.

KPPI plans to raise up to P384.8 million from the sale of 67 million common shares at a maximum price of P5.74 per share. The offer shares will represent 33.34 percent of the company’s outstanding common shares.

The offer period will be from Aug. 5 to 9. KPPI will be listed on the small, medium, emerging board of PSE.

PSE president and chief executive officer Ramon Monzon welcomed the listing, which would likely be the first IPO for the year. No company has braved the market so far this year because of volatility in the early part.

“It may have taken some time before we had our first IPO, but I am pleased that KPPI is embarking on its maiden share sale. I hope that this move will encourage other companies that pushed back their IPOs to revisit their plans and consider the stock market as an avenue for capital raising,” Monzon said.

“I am also pleased that we have a new listing on the SME board. I hope this will prompt companies who qualify to list on this board to explore the possibility of raising funds through an IPO,” he said.

KPPI plans to use the net proceeds to diversify its asset base and expand its office leasing portfolio with the acquisition of about 3,500 square meters of leasable space.

Of the amount, the company plans to disburse P245 million to acquire office spaces primarily in Pasig City and Makati City, and P120 million in Davao City within the first half of 2020.

It also plans to invest in short-term liquid investments such as short-term government securities, bank deposits and money market placements, which are expected to earn prevailing market rates. If such investments incur losses, any shortfall will be financed by internally generated funds.

Incorporated in 2005, KPPI is primarily engaged in the business of investing in, purchasing, or otherwise acquiring and owning  properties including hotels, inns, resorts, apartments, or personal property.

At present, the company owns 77 office condominium units with 98 leasable spaces in Kepwealth Center, a commercial building located at Samar Loop corner Cardinal Rosales Avenue, Cebu Business Park, Cebu City.

Upon completing its IPO-funded acquisitions, KPPI expects to have an estimated 18,121 square meters of leasable space.

The company tapped BDO Capital and Investment Corp. as the sole issue manager, underwriter and bookrunner.