IPO-bound SBS eyes Asean expansion

Chemical distributor SBS Philippines Corp. plans to strengthen its presence in Southeast Asia to take advantage of fast growing markets in the region, its top official said.

Necisto Sytengco, president and chairman of SBS, said while the company is already exporting its products to some countries in the region such as Malaysia and Vietnam – accounting for less than 10 percent of the business – it wants to further expand its presence.

“Right now, it’s less than 10 percent (of the business). Maybe if we can balance that most likely to 30 percent in two to three years from now,” Sytengco told reporters on the sidelines of the company’s investors briefing late Monday.

“The goal of the company is really to expand not only locally but also regionally,” he said.

He also said the company would continue to be on the lookout for opportunities in the region.

“Strategic locations are Malaysia and Vietnam. These markets are already opening up in the region because of the AFTA,” he said, referring to the Asean Free Trade Area, a trade bloc agreement by the Asean which supports local companies in all Asean countries.

Sytengco said the company is considering putting up distribution hubs in strategic countries in the region.

SBS is embarking on a P1.15 billion initial public offering of 420 million common shares to be sold at P2.75 per piece.

Sytengco said the company decided to list in the market to ensure continued growth.

The offer period will be from July 28 to Aug. 3 while the listing date will be on Aug. 10.

Proceeds of the IPO would be used for production expansion, capital expenditures, refinancing requirements and working capital, SBS chief financial officer and treasurer Aylene Sytengco said.

SBS is a major chemical supplier with a customer base of over 1,800. It supplies a wide range of chemicals and ingredient products and services the requirements of major industrial and manufacturing businesses in the country for various needs such as cleaning and sanitation, food ingredients, chemical manufacturing, personal care, crop protection and animal care among others.

It registered P933 million in sales last year, 18.7 percent higher than the P786 million posted in 2013.

The Sytengco family directly and indirectly owns 99.93 percent of SBS. After the IPO, this would go down to 64.95 percent.