Frontier Oil defers IPO to next year due to ‘Yolanda’ backlash
MANILA, Philippines–Oil exploration firm Frontier Oil Corp. has deferred its P2.2-billion initial public offering (IPO) worth as much as P2.2 billion to early next year, noting market jitters and meeting disruptions arising from the catastrophic Typhoon “Yolanda” (international name:Haiyan).
“In consultation with the company’s underwriters and several significant investors, FOC believes it in the best interests of both the company and its shareholders to defer its listing until early next year,” Frontier Oil president Kristoffer Fellowes said in a letter to the Philippine Stock Exchange dated Nov. 25.
Frontier Oil’s IPO would have run from Nov. 25 to 29 while listing on the PSE’s main board under the ticker “FOC” would have been on Dec. 9 this year.
“Additionally, the company is concerned that the tragic and dramatic events surrounding Typhoon Ulanda (local name: Yolanda) have understandably created an uncertain investment environment in the Philippines over the past few weeks. Those events have caused a number of scheduled meetings and activities to be deferred,” Fellowes said.
The Frontier Oil executive said he expected the revised timetable to “overcome any negative impact upon both the FOC IPO and emerging markets more generally from the tapering off of the quantitative easing measures in the United States.”
Frontier Oil was given authority to sell up to 883.626 million in primary common shares for as much as P2.50 per share, bringing to public hands about a third of the company’s outstanding shares after the IPO. The issue managers and joint lead underwriters are Philippine Commercial Capital Inc. and Unicapital Inc.
The company plans to use bulk of the proceeds amounting to P1.55 billion for the “Calauit Field” in service contract 50. Another P256.87 million was earmarked for “Nassipping Field” in SC 52 and P202.87 million for working capital.
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