Axelum seeks to acquire allied businesses overseas | Inquirer Business

Axelum seeks to acquire allied businesses overseas

By: - Business Features Editor / @philbizwatcher
/ 05:08 AM August 05, 2019

Axelum president Henry Raperoga

Upcoming stock market debutante Axelum Resources Corp., an integrated coconut product manufacturer, is looking to acquire allied businesses in Vietnam and Indonesia to expand its export-oriented portfolio.

Based on its initial public offering (IPO) prospectus, Axelum intends to use P1.85 billion or 39 percent of the proceeds from the primary portion of its public offering to fund “strategic acquisitions” in 2020 to 2022.


“We are looking at doing two or three in Southeast Asia…One is in Vietnam. I think (there will be) one or two in Vietnam and Indonesia,” Axelum president Henry Raperoga said in an interview.


Axelum’s public offering was estimated at P7.7 billion, based on the maximum price, but excluding proceeds from the sale of secondary shares, net proceeds that will go to the company were estimated to hit up to P4.77 billion.

The company intends to sell up to 700 million primary shares and up to 430 million secondary shares at a maximum price of up to P6.81 per share.

At its maximum price, Axelum’s IPO was valued at 21 to 22 times prospective earnings, at a discount to the market price of closest industry peers which were trading at 24 times projected earnings.

Axelum produces high-quality coconut products. About 88 percent of its products are export-oriented.

Its main production facility is located in Medina in Misamis Oriental, where it is the biggest employer.

Based on its prospectus, the company’s potential target acquisitions should be able to market coconut and other related products markets such as the USA, Europe, Eastern European, Middle East and major countries in Asia. 


Axelum said in its prospectus that the markets served by the potential target acquisitions markets “must have a strategic fit with the company’s current operations and present opportunities for it to explore other business segments such that it can add value to the new markets and/or products using the company’s existing competitive strengths.” 

“The company is still in the early stages of evaluating these options and no definitive agreements have been signed,” it added.

Axelum is in negotiations with several parties to promote its products as well as express potential joint venture on buy-in arrangements to boost existing business relationships, expand supply chain arrangements, and vertically integrate its business, the prospectus said.

First Metro Investment Corp., the investment banking arm of the Metrobank Group, acts as issue manager, bookrunner and lead underwriter of the IPO.

The rest of the proceeds will be used to expand domestic and international distribution networks, install new manufacturing facilities for new products, and improve and expand the existing manufacturing facilities. A portion will also be used to retire loans, reduce payables, and fund other capital expenditure requirements.

Axelum’s coconut products are used by international food and beverage companies, confectioneries, bakeries, private label supermarkets and grocery store chains, food service industries, coconut coffee creamer manufacturers, cosmetics and diet-prepared food market.

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Its direct or indirect customer base includes prominent global brands like Vita Coco, The Hershey Co., ConAgra Foods, Kellogg’s, Quaker, Nestle, Russell Stover, Unilever, Kroger, Mondelez International, Ferrero, Kraft Foods, General Mills, Campbell’s, Mars, Cadbury Schweppes, and Calbee, among others.

TAGS: Axelum, Business

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