DM Wenceslao and Associates Inc., a 40-year-old property and infrastructure developer, plans to raise P18.88 billion in fresh funds for expansion from a stock debut in November.
In a registration statement filed at the Securities and Exchange Commission, DM Wenceslao said it was planning to issue 429.17 million shares at a maximum price per share of P44 each.
The offering, which is targeted by November 2 to 6 this year, may be upsized by 64.375 million additional shares in case of strong demand, bringing maximum offering size to P21.7 billion. This is the largest stock debut proposed at the local bourse so far this year.
“We intend to use majority of our net proceeds from the firm offer to fund the development of our pipeline projects, purchase land assets through share acquisitions, develop infrastructure within Aseana City and for other corporate purposes,” the company said in its regulatory filing.
Part of the offering may consist of secondary shares to be sold by shareholder Wendel Holdings Co.
The company has mandated the following to act as joint global coordinators: BPI Capital Corp., CLSA Ltd., Deutsche Bank AG and Maybank Kim Eng Securities Pte. Ltd. The domestic lead BPI Capital Corp. and Maybank ATR Kim Eng Capital Partners Inc. while the domestic co-manager is CLSA Exchange Capital Inc.
At least 70 percent of the offering, including the optional shares, are proposed to sold to the overseas market.
About 128.75 million shares are proposed to be offered to PSE trading participants and retail investors.
As a dividend policy, DM Wenceslao said it was planning to declare as annual cash dividends 30 percent of prior year’s net income except when the company was spending for expansion, when in need to retain earnings for probable contingency or whenever restrained by loan covenants.
DM Wenceslao has P25.6 billion ($565.7 million) assets in its books as of end-June. On a pro-forma basis, it posted P338.5 million or $7.5 million in net profit attributable to equity holders of parent out of P769.3 million or $17 million in revenues. Net profit was 64 percent higher than the level in 2013 while revenues were up by about 30 percent.
In the first half of 2015, DM Wenceslao grew its net profit to P536.7 million from 35.8 million while revenues surged to P926 million from P210.1 million in the previous year.
Apart from various construction and engineering projects, the Wenceslao group is developing central business districts such as the Aseana Business Park along Manila Bay in Paranaque City and the Mandau Business Park in Cebu. The reclamation phase of the 204-hectare Aseana is 45 percent complete while the 295-hectare turnkey project for Mandaue City is ongoing, based on its website. It also has some housing and landbanking projects.