Medilines Distributors Inc., a leading distributor of medical equipment to public and private healthcare facilities, seeks to raise P2 billion from an initial public offering in November.
MDI said in a filing with the Securities and Exchange Commission it would sell up to 825 million common shares at an offer price of P2.45 each.
Net proceeds from the maiden share offering will be used to fund product portfolio expansion and debt repayment plans, the company’s filing showed.
Under the plan, MDI will spend P541.5 million as initial working capital to expand product portfolio to include medical consumables which are low-cost, yet high-margin products that are regularly used by customers to operate the high-value equipment that it sells.
It also plans to allot P743.1 million to retire debt which were used primarily to fund working capital.
“We believe that pursuing this strategy will increase the overall shareholder value of the company as this will decrease our financing cost,” MDI said.
Offer period was tentatively set on Nov. 11 to 17, while listing was scheduled on Nov. 25.
The company hired PNB Capital and Investment Corp. as the sole issue manger, lead underwriter and sole book runner for the fund raising activity.
“We are excited to work with Medilines in drawing out another opportunity to bring to the capital market an essential and pandemic-resilient business,” said PNB Capital president Gerry Valenciano.
“We envision this to be the first pure-play healthcare IPO in the Philippines,” he said.
MDI maintains a portfolio of best-in-class equipment from multinational medical device companies such as Siemens (Germany) for diagnostics imaging, B. Braun (Germany) for dialysis, and Varian (USA) for cancer therapy.
Its customers include the Department of Health and local government units and private healthcare facilities, hospitals, clinics and diagnostic centers.
Its portfolio primarily caters to the leading categories of specialized medicine, including diagnostic imaging, dialysis and cancer therapy that collectively amounted to P17 billion in sales under the medical equipment market of the Philippines in 2020.
It is dominant player in the distribution segment of dialysis and cancer therapy equipment, holding 50.5 percent and 90.4 percent of the market, respectively in 2020.