The Securities and Exchange Commission (SEC) has given its approval to 8990 Housing Development Corp. to proceed with its P6.4-billion follow-on offering, of which proceeds will be used to fund the firm’s land-banking activities and working capital.
A filing with the SEC showed that the commission has approved 8990 Holdings’ sale of 1.034 billion shares at a maximum price of P12.70 a share from January 30, 2014, to February 14, 2014. The official listing date of the shares in the Philippine Stock Exchange will be on February 21, 2014.
“The company estimates that its net proceeds from the primary offer will be approximately P6.4 billion after deducting the applicable underwriting discounts and commissions and expenses for the offer payable by the company,” the real estate firm told the SEC.
8990 Holdings said that it intends to use the net proceeds from the offer for additional investment in its subsidiaries, land banking and working capital requirements.
Specifically, approximately P2.5 billion will be used for land-banking activities. Of this P2.5 billion, bulk will be used for the company’s acquisition of a 13-hectare property in Ortigas Avenue Extension, Pasig City, while the rest will be used to bankroll the firm’s planned purchase of a 30-hectare property in Davao City.
Of the remaining amount of proceeds from the offer, P2.5 billion will be used to beef up the firm’s working capital requirements, while the P1.4-billion balance will be used for general corporate purposes.
The issue manager and lead underwriter for the transaction is SB Capital Investment Corp.