Strong demand for Cebu Landmasters IPO
THE initial public offering (IPO) of Cebu Landmasters, Inc. (CLI) has received strong demand from investors, according to an underwriter.
In a statement released on Monday, BDO Capital and Investment Corp. President Eduardo V. Francisco said the offer was oversubscribed, prompting them to sell the over- allotment portion of the deal by the end of its offer period on May 26.
“We saw very strong demand coming in during the offer period — from institutions, brokers and retail clients. Because of this, we sold the over- allotment shares for this IPO. Even then, we are already oversubscribed and more orders are coming in,” Mr. Francisco was quoted as saying.
BDO Capital is one of the offer’s joint lead underwriters and bookrunners of the offer along with BPI Capital Corp.
CLI sold 505 million shares by primary offer and 75 million shares through an over- allotment option, each priced at P5, which brings the total offer size to P2.9 billion.
“We are quite pleased with how the market has responded to this issue despite being offered in the market together with another great company. But given CLI’s unique investment proposition as a pure VisMin play on real estate and infrastructure, coupled with its attractive growth prospects, we feel that CLI will be a worthwhile investment and an asset to our capital markets,” Mr. Francisco said.
The Cebu- based property developer is the third company to go public this year, after the listing of tycoon Ramon S. Ang’s Eagle Cement Corp. on Monday, and Wilcon Depot last March 31. CLI is set to debut on the PSE on June 2. CLI, which was established by real estate veteran Jose R. Soberano III in 2003, is currently expanding in the Visayas and Mindanao region. Net proceeds of the IPO will be used to fast- track this expansion, which involves 13 projects under various stages of development and construction, as well as six others planned in the future.
“We like Cebu Landmasters because it is a beneficiary of strong demand for housing in the faster growing areas of the VisMin region,” COL Financial Head of Research April Lynn C. Lee-Tan said in the statement.
“It also has a strong track record in execution given the experience of Mr. Soberano in real estate development, his familiarity with the Visayas region, and his hands- on involvement in the company and its projects,” she added.