Cemex Holdings lowers IPO price

0

Cemex Holdings Philippines Inc. on Thursday lowered the price of its initial public offering (IPO) from P17 to P10.75 per share.

Advertisements

Cemex, a unit of Mexico’s Cemex SAB De CV, is offering some 2.03 billion common shares with the option to sell 304.94 million more to cover additional demand.

The company intends to raise some P25.04 billion, lower than the previous estimate of
close to P40 billion, but still one of the biggest IPOs in the country.

Alexander Adrian Tiu, senior equity analyst at AB Capital Securities Inc., noted Cemex is overpriced at P17 apiece. The fact that the proceeds of its IPO would be mainly utilized to settle its monetary obligations is another point to consider.

“It would use the IPO proceeds to pay its debt so it is not really okay,” Tiu said.

Proceeds from IPO will repay some $504 million of the company’s -term and long-term loans from Sunward Holdings BV.

The loan was secured with the acquisition of its operating units Apo Cement Corp. and Solid Cement Corp. as part of its reorganization.

The debt carries an interest rate of 5.21 percent a year, and would fall due and demandable on July 9, but renewable in September and December, according to Cemex’s registration statement.

The company has several long- and short-term loans that carry a 7.535 percent interest rate. Some $35.3 million would fall due and demandable in 2020, and $105.9 million each in 2021, 2022, and 2023.

BDO Capital and Investment Corp. will serve as domestic lead underwriter, while the joint global coordinator and joint bookrunners are Citigroup Global Markets Ltd.-United Kingdom, J.P. Morgan Securities PLC-UK, and The Hongkong and Shanghai Banking Corp. Ltd.-Singapore Branch.

Share.
loading...
Loading...

Please follow our commenting guidelines.

Comments are closed.