SEC clears P44-B public debut of Del Monte PH
The Securities and Exchange Commission (SEC) has approved the initial public offering (IPO) worth up to P44.07 billion planned this August by Campos family-led Del Monte Philippines Inc. (DMPI), one of the largest fresh pineapple growers in Asia.
This is potentially the second largest IPO in the history of the local bourse, next to Monde Nissin’s P48.6-B debut last June.
During its July 12 meeting, the SEC en banc gave preclearance to the registration statement of DMPI covering about 2.797 billion common shares to be listed and traded on the main board of the Philippine Stock Exchange (PSE).
Subject to further approval by the PSE, DMPI seeks to conduct the IPO from August 9 to 13 and list on the local bourse on August 23.
The corresponding order of registration and permit to sell will be issued after the firm has complied with the conditions set by the SEC.
DMPI’s registration statement covers 699.33 million in secondary common shares, which will be offered to the public for as much as P54.80 per share, plus up to around 104.9 million additional secondary common shares to cover excess demand.
Maximum offer price
Assuming the overallotment option is exercised, 28.75 percent of DMPI’s shares will be held by the public after this equity deal.
The selling shareholders are Central American Resources Inc., a subsidiary of DMPI’s parent conglomerate Del Monte Pacific Ltd. (DMPL)., and SEA Diner Holdings (S) Pte Ltd., the Singapore-based consumer-focused fund manager that bought into the company last year.
Gross proceeds from the IPO could amount to P38.32 billion at the maximum offer price. If the overallotment option is fully exercised, the offer can raise an additional P5.75 billion.
Parent conglomerate DMPL will eventually receive and use part of the net proceeds to repay loan facilities, redeem certain preferred shares and spend for general corporate purposes.
DMPI is a food manufacturer operating four main product segments, namely convenience cooking and dessert, healthy beverages and snacks, premium fresh fruit and packaged fruit and beverages for export. Its Del Monte brand offers a line of ketchup, tomato sauce and paste, pasta, spaghetti sauce and packaged pineapple products, among others.
Resilient
Morgan Stanley Asia (Singapore) Pte. and Credit Suisse (Singapore) Ltd. will serve as joint global coordinators and bookrunners for the offer, while CLSA Ltd., DBS Bank Ltd. and Jefferies Singapore Ltd. will be the joint international bookrunners.
BDO Capital & Investment Corp. and BPI Capital Corp. are the joint local lead underwriters and bookrunners, while First Metro Investment Corp. is a colead local underwriter.
Operating in the food production space—one of the few industries that have proven to be resilient despite the prolonged pandemic—DMPI’s proposed offering is over two times larger than its aborted IPO plan in 2018.In the fiscal year ending April 2020, DMPI’s net income stood at P3.47 billion, up by 34.7 percent from the previous fiscal year. This was on the back of an 11-percent growth in revenues to P31.92 billion.
