Taiwan firm eyes PH as manufacturing hub; local unit sets P6.77-B IPO
Taiwan-based New Kinpo Group (NKG) is grooming the Philippines to be its next Southeast Asian electronics manufacturing hub with a P6.77-billion local stock market debut planned by its local arm, Cal-Comp Technology (Philippines) Inc.
Simon Shen, NKG chief executive, yesterday said the group was boosting its operating capacity in the Philippines as it shifted the focus of operations in China.
“China will move toward higher level R&D (research and development), so its manufacturing component will slowly be transitioned to the Philippines. This IPO (initial public offering) will allow us to raise the funds needed to support the transition and help the Philippines enhance its manufacturing and R&D strengths.”
Cal-Comp has filed in the Securities and Exchange Commission an application to raise up to P6.77 billion through the issuance of new shares, mainly for facilities expansion, acquisition of new equipment and increased investment in R&D.
“We are ramping up investments in the Philippines as we believe in the country’s economic potential. With a tech-grounded world, we intend to expand Filipinos’ access to technologically advanced products, equipment and training,” Shen said.
The NKG unit plans to sell up to 397.97 million new common shares at a maximum price of P17 per share, bringing about 26.77 percent of the company’s shares to public hands. The base offer consists of 378.07 million common shares but the company seeks an option to upsize the issuance by up to 19.9 million.
Cal-Comp Technology has earmarked P1.88 billion for the construction and development of phases 2 and 4 of its First Philippine Industrial Park Inc. (FPIP) manufacturing complex in Sto. Tomas, Batangas, where its subsidiary, Kinpo Electronics (Philippines) Inc. (KPPH), is located. This will add some 48,000 square meters of space for manufacturing.
It aims to enter into additional land leases within FPIP covering some 300,000 sqm to increase its manufacturing capacity. About P1.26 billion of the proceeds will be allocated for this purpose.
With the facility expansion, the company expects to acquire P844 million worth of new assembly equipment and machinery. It also expects to upgrade existing equipment to increase production capacity. These acquisitions will include surface mount technology (SMT) and assembly lines for storage, home appliance, and calculator products.
Cal-Comp also intends to pour P800 million into R&D, specifically to introduce new products in the next four to five years. It is set to launch its own-branded products to the Philippine market within the year.
Another P243.7 million will be used for other capital expenditure requirements, including the purchase of miscellaneous equipment and computer software required for Cal-Comp Technology’s production operations.
Cal-Comp Technology will allocate P900 million for repayment of KPPH’s short-term loans with Metrobank and Cathay United Ban, proceeds from which had been used for working capital.
Cal-Comp Technology is engaged in global electronic manufacturing services and original design manufacturing. It produces multiple product lines including external hard-disk drives, TVs, all-in-one PCs, laser printers, smart home appliances, power supplies, 3D printers, innovative smart beauty mirrors, A.I. humanoid robots, and integrated circuits for cloud computing.
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