Manila's Pepsi bottler prices IPO at bottom of range
The bottler for Pepsi-Cola in the Philippines priced its IPO at 3.5 pesos a share, nearly half its initial indicative offer price.
By Agencies |
MANILA: The bottler for Pepsi-Cola in the Philippines priced its initial public offering at 3.5 pesos a share on Saturday, nearly half its initial indicative offer price after a dire start to the year for equity markets.
Pepsi-Cola Products Philippines will now raise just 3.99 billion pesos ($98 million) from its listing on Feb. 1, after earlier touting an indicative offer price of 6.04 pesos.
The indicative range was later shrunk to 3.50-4.30 pesos. One of the underwriters said concerns the local equity market, already down 12.5 per cent so far this year amid fears of a US recession and sub-prime mortgage losses, has further to drop encouraged the company to be cautious.
"Overall market sentiment is just bad, especially with US market drops and possible additional sell-offs if more subprime write-offs are announced," said Ed Francisco, executive vice-president of BDO Capital, one of two domestic lead underwriters organising the offer.
The group plans to sell 1.14 billion shares, or more than one-fifth of its capital, part of which would finance project expansion, both for carbonated and non-carbonated drinks. The company will offer both primary and secondary shares to the public, with the primary offer comprising almost a third of the total.
Nearly 70 per cent of the shares up for sale would be offered to foreign investors, with the rest to be sold domestically. Pepsi-Cola Products competes with Coca-Cola Bottlers Philippines Inc, which is now 100 per cent owned by Atlanta-based Coca-Cola Co. UBS has been named as Pepsi-Cola Product's sole international underwriter and book runner.
Pepsi-Cola Products Philippines will now raise just 3.99 billion pesos ($98 million) from its listing on Feb. 1, after earlier touting an indicative offer price of 6.04 pesos.
The indicative range was later shrunk to 3.50-4.30 pesos. One of the underwriters said concerns the local equity market, already down 12.5 per cent so far this year amid fears of a US recession and sub-prime mortgage losses, has further to drop encouraged the company to be cautious.
"Overall market sentiment is just bad, especially with US market drops and possible additional sell-offs if more subprime write-offs are announced," said Ed Francisco, executive vice-president of BDO Capital, one of two domestic lead underwriters organising the offer.
The group plans to sell 1.14 billion shares, or more than one-fifth of its capital, part of which would finance project expansion, both for carbonated and non-carbonated drinks. The company will offer both primary and secondary shares to the public, with the primary offer comprising almost a third of the total.
Nearly 70 per cent of the shares up for sale would be offered to foreign investors, with the rest to be sold domestically. Pepsi-Cola Products competes with Coca-Cola Bottlers Philippines Inc, which is now 100 per cent owned by Atlanta-based Coca-Cola Co. UBS has been named as Pepsi-Cola Product's sole international underwriter and book runner.
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