If you could not get through the front door, try the backdoor…backdoor listing that is.
Could this be the principle being adopted by LBC Express Inc., which is reportedly looking for a listed shell company that it could use as a backdoor listing vehicle, after itwithdrew its initial public offering application with the Securities and Exchange Commission in the middle of 2014.
Industry sources said LBC Express, one of the country’s leading couriers and freight forwarding services firms owned by the Araneta family, was now considering a backdoor listing, on concerns it would not be able to raise capital through the straight IPO, as its application might not be approved by corporate regulators.
So why is LBC Express having a hard time getting its planned IPO approved by regulators? Apparently, it had something to do with its affiliation with LBC Development Bank, a thrift bank also owned by the Araneta group, which was closed down in 2011.
LBC Express earlier planned to raise P7.7 billion from the planned sale of up to 286.956 million in primary and secondary shares, with an overallotment option for another 43.043 million shares at an offer price of up to P21.16 apiece.
But in a letter to the SEC in July 2014, LBC Express said it was withdrawing the plan to generate funds through the equities market, as it explored other options to raise capital.
One of the companies reportedly being considered by LBC Express as a backdoor listing vehicle has recently denied it was being acquired by shareholders of a listed property developer.