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Friday, March 29, 2024

Chelsea prices IPO at P10.68 per share

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Chelsea Logistics Holdings Corp., a transportation company led by Davao City-based businessman Dennis Uy, priced its initial public offering at P10.68 per share, enabling it to raise up to P5.84 billion in proceeds, according to the underwriter handling the transaction.

The final offer price is 27 percent lower than the maximum offer price of P14.63 earlier set by the company.

BDO Capital and Investments Corp. president Eduardo Francisco said in a text message that at P10.68 per share, the offering would be sufficiently covered and would provide investors an upside for growth.

“We have convinced Mr. Uy to give an upside and to ensure the success of the IPO,” Francisco said.

Francisco said investors who were previously unsure of investing in CLC because of the financial restatement of its investee company 2Go Group Inc. would now be enticed to buy the stock because of its  attractive offer price.

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“The shipping and logistics industry plays a vital role in boosting trade and commerce within the Philippines and among countries. That makes Chelsea Logistics a sound and fulfilling investment,” Francisco said.

CLC will sell 546.593 million new common shares during the offer period on July 24 to 31.

The shares, which represent 30 percent of the company’s outstanding common shares, will be  listed with the Philippine Stock Exchange on Aug. 8 under the ticker symbol “CLC”.

“Chelsea Logistics has received strong interest from institutional investors and continues to attract more, as it proceeds with its initial public offer of common shares,” Francisco said.

Investors earlier expressed concern about the impact of 2Go’s financial restatement on the company’s business prospects. The restatement resulted in substantial reduction in 2Go’s 2015 and 2016 profits.

CLC earmarked proceeds from the IPO for fleet expansion; purchase and/or upgrade of ports, port facilities, containers and machineries and equipment; acquisition of other shipping and logistics firms; and general corporate purposes.

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