Cosiquien to take cold storage firm public via P1.5-B IPO
Businessman Michael Cosiquien is joining the initial public offering (IPO) rush of 2022 after filing a P1.5-billion listing application for his cold storage company, ORCA Cold Chain Solutions.
This is Cosiquien’s first IPO after he announced his exit five years ago from Megawide Construction Corp., the listed contractor and infrastructure company he cofounded, to focus on personal business ventures.
Established in 2017, ORCA is raising money in October to help double cold storage capacity over the next five years and go nationwide by opening in new areas in Luzon, the Visayas and Mindanao.
ORCA, whose corporate name is ISOC Cold Chain Logistics Inc., is a pioneer in automating the local cold storage industry.
Cold storage facilities are temperature-controlled buildings designed to extend the shelf life of fresh and processed food products.
ORCA veered away from the traditional manual process to use the automated storage and retrieval system or ASRS, which it said was more accurate and efficient. The strategy also made it one of the few private sector players allowed to store COVID-19 vaccines during the global health crisis.
Based on its June 22 IPO prospectus, ORCA would sell as much as 1.7 billion shares, or 23 percent of the company, at an indicative price of P0.88 each.
This involves the sale of 1.03 billion primary shares, or those allotted for business expansion, to raise about P910 million.
ORCA’s controlling shareholders, ISOC Holdings Inc. and Philware Magnate Inc., would sell another 444.8 million shares worth P394.2 million.
ISOC is the holding firm of Cosiquien, who sits as ORCA chair, while Philware is led by his brother Yerik Cosiquien, who is also the president and CEO of ORCA.
The selling shareholders are allotting another 222 million shares, worth P195 million, for post-IPO price stabilization activities.
ORCA is targeting to finalize the IPO price on Oct. 17, while the offering will be on Oct. 20 until Oct. 24.
The proposed listing date, under the stock symbol “ORCA,” was set for Nov. 3 this year, the prospectus showed.
Record-breaking year
ORCA is poised to become the 12th company to go public in what could be a record-breaking year for IPOs in the Philippine Stock Exchange despite global recession worries.
Other planned listings in the pipeline are billionaire Enrique Razon Jr.’s Prime Infrastructure Capital Inc., software and hardware retailer Upson International Corp. and North Star Meat Merchants, which postponed its IPO originally set in early June.
ORCA has two cold storage facilities, in Taguig and Caloocan, with a combined capacity of 34.3 million kilograms or 34,342 pallet positions. Pallets are portable and stackable square platforms on which goods are placed.
ORCA said it was planning to build five more facilities until 2027 to expand capacity to 69 million kg or 69,292 pallets. New expansion areas include Cagayan de Oro, Cebu, Tarlac, Pangasinan and Davao.
The company sees room for expansion given rising demand for meat and seafood storage solutions amid a prevailing “moderately fragmented” competitive landscape, according to Ken Research.
The market research firm showed ORCA with a 6-percent market share while its three larger competitors controlled 9 percent, 13 percent and 30 percent, respectively.
ORCA revenues in 2021 grew 15.4 percent to P339.7 million while losses narrowed by 12 percent to P312.4 million on higher expenses.
