Medilines Distributors Inc., a distributor of medical equipment to public and private healthcare facilities across the country, has priced its initial public offering (IPO) at P2.30 per share.
The said price is just 6 percent lower than its indicative price of P2.45 per share.
“We wanted to leave more upside on the table for our new shareholders who would get to directly participate for the first time in the continuous growth of the healthcare industry in the Philippines,” Virgilio B. Villar, chairman of Medilines, said.
The company will be offering up to 550 million primary common shares and up to 275 million secondary shares. It will have proceeds of about P1.88 billion at the current price.
Medilines shares were 2.7 times oversubscribed, due to overwhelming demand from a number of long-only institutional investors, according to sources.
Part of the proceeds from the IPO will be directly used by Medilines for its foray into the high-growth, high-margin medical consumables business to support the growing industry.
“We hope to attract long-term shareholders that share our vision in providing quality healthcare to every Filipino,” Villar, the brother of real estate magnate Manuel B. Villar Jr., said.
Both the Securities and Exchange Commission and the Philippine Stock Exchange (PSE) have already given their green light for Medilines’ IPO, which will be traded under the ticker MEDIC.
The target offer period for the IPO will be from November 22 to November 26, while the listing date is on December 7.
Founded in 2002, Medilines plans to expand its presence and product portfolio to help enhance the country’s healthcare system through quality medical devices.
The company’s revenues for the first semester jumped to P815 million which is higher by 281 percent year-on-year. Net income during the same period in 2021 was at P100 million which is equivalent to almost double of the net income posted for full-year 2020. The company attributes the profitability growth to the increase in sales of cancer therapy machines.
Based on a recent independent study by Ken Research, in terms of expenditure, the healthcare industry rose to P911.4 billion in 2020 from P489.1 billion in 2014 or a compounded annual growth rate of 11 percent.
Healthcare expenditure is expected to grow further to reach P1.5 trillion by 2025, driven by a growing and aging population, growing incidences of diseases, such as cancer and pneumonia, as well as increased efforts by the government to expand and modernize the country’s healthcare facilities.
“The move is expected to further strengthen the interest in the country’s first pure-play healthcare IPO,” Gerry B. Valenciano, president and CEO of PNB Capital and Investment Corp., said.
PNB Capital is the offer’s sole issue manager, lead underwriter and sole bookrunner.
Retail investors will be able to buy the IPO shares online via PSE Electronic Allocation System during the offer period. The minimum subscription will be P2,300 and a maximum of P98,900.