SEC approves Puregold initial public offering

MANILA, Philippines—The Securities and Exchange Commission has approved a P10.8-billion initial public offering by grocery chain Puregold Price Club Inc., the country’s second largest retailer.

Based on a revised prospectus approved by the SEC, Puregold plans to offer up to 600 million common shares at a price of up to P18 per share, potentially ceding to the public about 34.5 percent of its outstanding stock after the IPO.

The indicative pricing was raised from an earlier target of P16 per share due to “better operating results” since the first prospectus was filed at end-2010, one of the underwriters said on Friday.

The stock debut is targeted for end-September or October depending on final clearance from the Philippine Stock Exchange. The earlier plan was to go public last March but this was shelved as global market conditions became unfavorable early in the year.

Of the total offering, up to 500 million will be in the form of new shares while up to 100 million will be in secondary shares to be offered by selling shareholders among the Co family.

Total proceeds to be raised by Puregold is up to P9 billion while the selling shareholders—Lucio Co, Susan Co, Ferdinand Vincent Co, Pamela Justine Co and Camille Clarisse Co—will generate up to P1.8 billion from the secondary share sale.

HSBC and UBS were retained as the international lead managers while BDO Capital & Investment Corp. and First Metro Investment Corp. would be the domestic lead underwriters.  Evercore Partners was named as financial adviser.

Puregold intends to use most of the proceeds for capital expenditures required for new stores while the remainder shall be used for debt refinancing.