D&L Industries to raise P6.3B via IPO

D&L Industries, a manufacturer of food ingredients and specialty plastic colorants and additives, is raising up to P6.3 billion through an initial public offering, according to company filings with regulators.

Based on its registration statement filed with the Securities and Exchange Commission, D&L plans to sell up to 1.07 billion primary shares, representing up to 30 percent of its outstanding capital, through an international and domestic offering.

Proceeds from the offer will be used for investments and acquisitions, payment of financial obligations and general corporate purposes, the company said.

The offer period is to be concluded in the fourth quarter of 2012, after which the shares would be listed on the Philippine Stock Exchange.

D&L is an industrial group established almost 50 years ago by brothers Dean and Leon Lao. It holds a 34 percent stake in publicly listed Chemrez Technologies.

Aside from its investment in Chemrez, D&L is the market leader in various industries where it operates through its wholly owned subsidiaries.

The company produces hundreds of variants of its products and focuses on designing customized and specialty product solutions for customers, mostly in the food and plastic products businesses.

Through wholly owned subsidiary Oleo-Fats, D&L manufactures a line of specialty fats and oils, culinary and other specialty food ingredients, industrial fats and oils for leading food manufacturers and fast-food restaurant chains in the country.

Another wholly owned subsidiary, Aero-Pack Industries, is the only manufacturer of three-piece aerosol cans in the country.

Affiliate Chemrez Technologies is engaged in the manufacture and sale of specialty industrial chemicals such as biodiesel, powder coatings and resins, which have various applications in the construction, shipping and furniture industries.

D&L’s consolidated revenues increased from P9.2 billion in 2009 to P12.8 billion in 2011, representing a compounded annual growth rate (CAGR) of 18 percent, while its consolidated net income increased from P226 million in 2009 to P997 million in 2011, representing a CAGR of 110 percent.

The company sees continued growth driven by a flourishing Philippine economy.

Maybank ATR KimEng Capital Partners has been mandated as the lead international and domestic underwriter, issue manager and sole bookrunner for the IPO.