Philippine Business Bank (PBB), the thrift bank arm of businessman Alfredo Yao’s Zest-O group, has obtained approval from the Securities and Exchange Commission to conduct an initial public offering worth up to P4.25 billion.
Based on documents filed in the SEC, PBB plans to sell 101.33 million primary common shares at a maximum price of P41.94 each, an exercise that will bring 29.51 percent of its post-IPO capital to public hands.
The maximum IPO offer price is about 2.63 times the bank’s book value of P15.92 a share.
PBB is targeting to launch the IPO within the month for prospective listing by November 23, but the final timetable is subject to approval from the Philippine Stock Exchange. Proceeds from the offering will be used to open new branches, improve the bank’s information technology, infrastructure system, acquire other branch licenses and for other general purposes.
The bank has mandated investment house Maybank-ATR KimEng Capital Partners Inc. to arrange the IPO.
PBB has 72 branches to date, of which 37 are in Metro Manila where branch expansion is restricted. These branches are positioned in business, commercial and industrial areas particularly those with a critical mass of small and medium enterprises, the bank’s target segment.
In the first six months of the year, PBB’s net profit expanded by 143 percent year on year to P496.64 million.
“It’s really more as a strategic move to be able to maybe expand business further and then (raise funds) as an added ammunition. We’re building a war chest for possible acquisition and investments in the horizon of over two to three years if there will be a license upgrade,” PBB president Roland Avante said in a recent interview.
Aside from PBB, Yao’s Zest-O group also includes local beverage-maker Zest-O Corp. and budget carrier Zest Air.