Discovery World defers IPO plan

Discovery World Corp., operator of upscale beach resort Discovery Shores Boracay (in photo), is pushing back plans to go public to mid-August 2013 or even as late as the fourth quarter of the year given persistent volatility in the stock market, a top official said.

MANILA, Philippines—Discovery World Corp., which operates a high-end resort in tourist hotspot Boracay, is pushing back plans to go public to mid-August or even as late as the fourth quarter of the year given persistent volatility in the stock market, a top official said.

The company’s initial public offering, involving 306 million new shares or 40 percent of its expanded capital, was approved by the Securities and Exchange Commission two weeks ago and was tentatively set to be sold to investors from July 23 to July 29.

The listing of the shares, priced at P3.28 each, was originally set for Aug. 1.

Discovery World president John Tiu told reporters on Friday that the company was not targeting to sell shares by mid-August or as late as October, assuming market conditions would improve.

“We are passing all the regulatory approvals [for now],” he said, including obtaining the approval of the Philippine Stock Exchange. “We are definitely looking at this year as long as the market remains stable.”

This follows similar announcements by other companies which are unwilling to risk a public listing given current conditions.

Travellers International Hotel Group Inc., which operates the Resorts World Manila casino complex, has postponed its P42-billion offering as did port services firm Harbor Star Shipping Services Inc. for a P600-million deal.

The Discovery World offering, being arranged by Abacus Capital and Investment Corp., is seeking to test the public’s appetite for a relatively small player in an industry that is tagged as one of the country’s growth engines.

The Philippines is targeting to draw 10 million tourists by 2016, from 4.3 million last year, triggering the aggressive development of hotels and resorts by large groups like Henry Sy’s SM Investments Corp., Ayala Land Inc. and Alliance Global Group Inc., led by Andrew Tan.

Discovery World booked P111.55 million in revenue in the first quarter, up 3.65 percent, while net income hit P14.16 million, up 112 percent, from year-ago levels.