MANILA, Philippines - Filipino-Chinese businessman Lucio Co’s grocery chain Puregold Price Club Inc. is pursuing its planned initial public offering (IPO) in the second half of the year.
BDO Capital & Investment Corp., the domestic lead manager for the share sale, said Puregold prefers to hold the IPO this year but noted that everything would depend on market conditions.
Puregold was supposed to debut on the local bourse last March but was forced to defer the move due to market volatility.
The company is seeking to raise up to P11.2 billion from the IPO with the sale of up to 700 million common shares, including a greenshoe option, at P16 each.
The offer, which will account for 36% of Puregold’s outstanding stock after the IPO, consists of up to 500 million new shares and up to 200 million shares from selling shareholders.
The company said it has an option to sell 100 million more shares depending on market demand. Proceeds will be used mainly for its store network expansion.
HSBC Ltd. has been tapped as international lead manager.
Puregold has gone full-blast on its expansion program with the construction of 35 new stores this year, 15 of which were slated to open within the first half.
Leveraging on the success of its retail and wholesale model, Puregold intends to establish presence in the largely underserved Visayas and Mindanao markets beginning 2012. Store openings are planned in Iloilo, Negros Occidental, Leyte and Cebu, as well as in Cagayan de Oro, Davao City and Gen. Santos City.
As part of its expansion plan, the company has entered into a total of 20 leasing agreements for its new stores to be opened in 2011 in various parts of the Philippines. These new stores are expected to provide 73,058 square meters of additional net selling space.