MAYNILAD Water Services, Inc., the west zone water concessionaire, remains confident despite a slight reduction in the size of its planned initial public offering (IPO) to P45.8 billion.
Maynilad said in a May 19 letter to the Philippine Dealing and Exchange Corp. (PDEx) that it has received positive preliminary investor feedback but that a formal demand assessment for the initial public offering has yet to be conducted.
The letter was sent following PDEx’s request for clarification on reports concerning the IPO’s size.
“We thus remain confident as we proceed to the next phase of the IPO process,” Maynilad said.
“Contrary to what may have been suggested in the articles, there is currently no indication of weak demand,” it added.
Maynilad said that the IPO still represents at least 30% of its outstanding capital stock, in compliance with its legislative franchise.
“While there has been a slight adjustment in the number of shares to be offered, this reflects a marginal reduction in the shares available for sale and does not change the intended offering size relative to the company’s capital structure,” the company said.
The water provider also said the IPO’s upsize option now consists solely of secondary shares.
“The decision for Maynilad not to pursue the upsize option, which now consists entirely of secondary shares, was made in line with the preferred structure of the offering. This is a common feature of IPO transactions,” it said.
Maynilad lowered the IPO size to a maximum of P45.8 billion from the previous indication of up to P49 billion, based on the company’s latest prospectus draft dated May 14.
The revised IPO comprises up to 2.29 billion common shares, down from the earlier maximum of 2.46 billion shares. The indicative maximum price remains at P20 per share.
The notice of final offer price to regulators is scheduled for July 1.
The IPO offer period will run from July 3 to July 9, with listing scheduled on July 17.
Maynilad appointed BPI Capital Corp., HSBC, Morgan Stanley, and UBS as joint global coordinators and joint bookrunners for the IPO. BPI Capital Corp. will also serve as the domestic lead underwriter.
The local stock market is expecting six IPOs this year, with Cebu-based fuel retailer Top Line Business Development Corp. as the sole debut so far.
Metro Pacific Investments Corp., which holds a majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., alongside Philex Mining Corp. and PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., holds an interest in BusinessWorld through the Philippine Star Group, which it controls. — Revin Mikhael D. Ochave
