THE PLANNED initial public offering (IPO) of Maynilad Water Services, Inc. is expected to boost interest in the Philippine stock market and lift investor sentiment, according to analysts.
“I think it’s helpful because doing that at least puts a spotlight on the Philippines. The successful listing and strong demand will show investors that there are some bright spots in the Philippines,” BDO Capital and Investment Corp. President Eduardo V. Francisco said in an interview with BusinessWorld last week.
Gabriel U. Lim, head of corporate finance at BDO Capital, said the size of the offering could have a meaningful impact on market activity. “It’s probably going to be a catalyst for the stock market considering its size,” he said.
Maynilad is offering 1.66 billion common shares to the public, alongside 24.9 million primary shares allocated to First Pacific Co. Ltd. The IPO also includes an overallotment option of up to 249.05 million primary shares and an upsize option of up to 354.7 million secondary shares to be offered by Maynilad Water Holding Co., Inc. (MWHCI).
At a final offer price of P15 per share, the offering could raise as much as P34.3 billion in gross proceeds. The company said proceeds from the primary tranche will be used to fund capital expenditures and general corporate purposes. It clarified that it will not receive proceeds from the sale of MWHCI’s shares should the upsize option be exercised.
The Maynilad IPO is poised to be the largest listing in the country this year and the biggest since Monde Nissin Corp.’s P48.6-billion offering in 2021.
The offer period will run from Oct. 23 to 29, with shares expected to be listed on the Philippine Stock Exchange’s Main Board under the ticker symbol MYNLD on Nov. 7.
The listing comes at a time when the benchmark Philippine Stock Exchange index (PSEi) has been under pressure, closing at 5,933.76 on Monday — its lowest finish since April 7.
“Hopefully, the stock market will go up [with this IPO],” Mr. Francisco said.
BDO Capital is among the domestic cornerstone investors in the offering.
Maynilad is majority-owned by Metro Pacific Investments Corp., one of three Philippine subsidiaries of First Pacific Co. Ltd., along with 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. — Alexandria Grace C. Magno