Businessman Manuel B. Villar Jr. on Thursday said the approval of regulators for the initial public offering (IPO) of supermarket operator AllDay Marts Inc. will boost confidence in the company’s resilience.
“This brings us closer to our vision to bring to the investing public another pandemic resilient business that continues to rapidly grow amid the Covid-19 pandemic,” Villar, AllDay’s vice chairman, said in a statement.
Last week, both the Philippine Stock Exchange (PSE) and the Securities and Exchange Commission gave their green light for the P6.02-billion IPO of AllDay. The company will be the sixth to list on the PSE this year.
The company will sell some 6.85 billion in common shares as its primary offer and an over-allotment option of 685.71 million shares as its secondary offer. Both will have a par value of P0.10 and will be sold at an indicative price of P0.80 per share.
The final price of the offer is scheduled on October 12, while the offer period is from October 18 to 25. It will be listed on the PSE on November 3.
Net proceeds from the sale could reach P5.82 billion, which the company will use for debt repayment, capital expenditures and initial working capital for store network expansion.
“We intend to retire our high-cost debt in the amount of P4.1 billion which were used primarily to fund our past and ongoing store network expansion. We believe that pursuing this strategy will increase the overall shareholder value of the company as this will decrease our financing cost by as much as P264.4 million per annum. Any balance of the net proceeds will allow us to partly fund our store network expansion,” the company said in its registration statement.
From incorporation in December 2016, the company has rolled out 33 stores as of June. AllDay intends to have 45 stores by 2022 and 100 stores by 2026.
“We just entered the ‘ber’ months where the mood is typically upbeat as we head into the consumption-driven holiday season,” Alvin Arogo, head of research of Philippine National Bank, said.
PNB Research Division expects the Philippine Stock Exchange index to finish at 7,490 to 8,100 this year on expectation that the relatively low yield environment will allow earnings multiples to remain elevated. This suggests a potential upside of 8 percent to 16.8 percent from Wednesday’s close of 6,934.11.
The benchmark index gained 18.70 points on Thursday to close at 6,952.88 points.
“The GDP growth starting the second quarter of 2022 will encourage positive sentiment and investors are looking forward to less strict pandemic curbs overall,” Arogo said.
PNB Capital and Investment Corp. has been appointed as sole issue manager for the transaction. PNB Capital, BDO Capital and Investment Corp. and China Bank Capital Corp. were picked as joint underwriters and joint bookrunners.