DoubleDragon files for new share offering
DOUBLEDRAGON Properties Corp. has lodged with the Securities and Exchange Commission (SEC) its application for a P7.5-billion follow-on offering that would help finance its aggressive expansion program.
The property developer, owned by the founders of Jollibee and Mang Inasal, said it filed the preliminary prospectus for the offer with the SEC on Wednesday.
The offer consists of the sale of up to 135 million common shares priced at P50 apiece, for a base size of P6.75 billion. DoubleDragon may exercise an over-allotment option of up to 15 million common shares or P750 million, bringing the total offer size to P7.5 billion.
The company has engaged Credit Suisse, Maybank Kim Eng Holdings Limited, and UBS AG as international book runners and lead managers, with BPI Capital Corp. and Maybank ATR Kim Eng as the domestic lead underwriters and book runners.
“This exercise is an important step for DoubleDragon that we believe will catapult the company into new levels,” DoubleDragon Chairman Edgar J. Sia II was quoted as saying in a statement.
A total of P4.8 billion from the proceeds of the capital raising activity will be used to for the development of 100,000 square meters ( sq. m.) in leasable industrial space under its newly formed industrial leasing unit, CentralHub Industrial Centers, Inc.
The remaining funds will be used to develop another 100,000 sq.m. from its target of 5,000 hotel rooms across both its Hotel101 and Jinjiang Inn brands.
This supports DoubleDragon’s plan to have 1.2 million sq.m. in leasable space by 2020. The rest will come from 700,000 sq.m. in 100 CityMalls, its community mall format in second and third-tier cities outside Metro Manila, and 300,000 sq.m. from its office projects, DD Meridian Park in Pasay City and Jollibee Tower in Ortigas.
The share sale also forms part of the company’s goal to achieve higher trading liquidity as well as to strengthen its balance sheet. This will boost DoubleDragon’s chance to be part of the 30-member Philippine Stock Exchange index.
DoubleDragon also noted that this will result in an increase in the firm’s total equity. As of the first half of 2017, the company’s total equity stood at P20.25 billion, while total assets were at P50.54 billion.
The company’s net income attributable to the parent reached P324.73 million in the first half of 2017, 147% up year on year. Revenues, meanwhile, surged 131% to P1.63 billion during the period.
DoubleDragon is a joint venture between Injap Investments, Inc. of Mr. Sia — the founder of the Mang Inasal grilled chicken restaurant chain — and Honeystars Holdings Corp. of Tony Tan Caktiong, chairman and founder of Jollibee Foods Corp.
Shares in DoubleDragon climbed P1.05 or 2.44% to P44 each at the stock exchange on Thursday.