Metro Retail Stores Group, Inc. is all set to be the third company to make its public debut this year after the Philippine Stock Exchange (PSE) late on Thursday approved its planned initial public offering (IPO).
Gaisano-owned Metro Retail hopes to raise P6.17 billion, offering a total of 1.012 billion shares priced at P6.10 each. The Securities and Exchange Commission (SEC) gave the IPO the green light last week.
The offering consists of 920 million in base offer shares and 92 million for oversubscription. Final pricing will be on October 29 and the offer period will run from November 2 to 6. Listing at the PSE Main Board is scheduled for November 12.
Metro Retail will only be the third firm to conduct an IPO this year. The PSE, which initially targeted nine to 10 listings for 2015, has trimmed its goal to five.
Market debuts were said to have been hindered by global volatility and confidence only recently picked up on expectations that a US Fed rate hike would be delayed to next year.
Metro Retail has said that expected net proceeds of P5.285 billion — without exercising the overallotment option — after expenses and taxes will be used for the expansion of its store network (P3.752 billion), building a logistics center (P1.215 billion) and working capital (P317.2 million), mostly for 2016 up to 2017.
BPI Capital Corp. and Deutsche Bank AG (Hong Kong branch) have been appointed joint global coordinators.
Metro Retail is embarking on a five-year plan that entails a P10-billion to P15-billion budget, with capital expenditures of P2 billion to P3 billion annually for five to 10 store openings. It plans to open at least seven stores in 2016 post-IPO.
Other than store expansion, the firm will also build a distribution center and an in-house trucking operations in Cebu.
Metro Retail, originally Cebu-based, was established by the Gaisano family, which decided expand in Metro Manila in the early 2000s via Market! Market! in Bonifacio Global City, Taguig.
The company has 45 stores to date —with a total net selling space of about 197,873 square meters—operated by over 9,000 employees serving more than 250,000 shoppers a day.
The firm is present in two major retail formats: department stores (Metro Department Store) and supermarkets and/or hypermarkets (Metro Supermarket, Super Metro Hypermarket, Metro Fresh ‘n Easy Neighborhood Store).
Aside from Metro Retail, property developer Datem Inc. is also seeking approval from the PSE to conduct a P4.65-billion IPO after securing SEC approval last week.