Advertisement

Converge pegs IPO price at P16.80

Fiber internet provider Converge ICT Solutions Inc. said Friday it priced its initial public offering at P16.80 per share, or at the lower end of the indicative price range of P16.50 to P19 apiece.

Converge ICT is expected to raise up P25 billion in proceeds based on the price level. The amount could reach P29 billion once the over-allotment shares were sold.

The offering period for the 1.73 billion shares is set from Oct. 13 to 19.

The maiden offering attracted eight foreign funds as cornerstone investors, including Canadian pension fund OMERS Administration Corp. and US-based fund Thornburg Investment Management Inc.

The net proceeds from the primary offering will be used to fund capital expenditures to accelerate the company’s nationwide fiber network rollout.

Converge ICT is conducting the IPO amid volatile market conditions brought about by the pandemic.

The company is on an expansion mode fueled by strong demand for faster internet connection as most people are working or studying from home, but it is also experiencing increased competition. Telecom players are beefing up their capital spending program to fund expansion projects.

Converge ICT has 750,000 residential customers mostly in and around Metro Manila but plans to reach 55 percent of the total households in the Philippines by 2025..

US-based private equity firm Warburg Pincus is a minority shareholder of the company. Coherent Cloud Investments B.V., a company managed by Warburg Pincus, plans to sell more than 1 billion common shares in Converge ICT.

Converge ICT’s earlier prospectus filed with the Philippine Stock Exchange showed that Coherent Cloud would convert its 2.045 billion preferred shares in the fiber internet company into common shares at a conversion ratio of 1:1. The conversion will take place on the pricing date of Converge ICT.

Morgan Stanley Asia (Singapore) Pte. and UBS AG Singapore Branch are the joint global coordinators and joint bookrunners for the offer, together with Credit Suisse (Singapore) Limited and Merrill Lynch (Singapore) Pte. Ltd. as international joint bookrunners.

The company tapped BPI Capital Corp. as the sole local coordinator and joint local underwriter and joint bookrunner with BDO Capital and Investment Corp.

Converge ICT’s IPO will be the country’s largest since 2013 when Cemex Holdings Philippines Inc. raised P25.13 billion in maiden share offering.

Among the largest IPOs in the country were SM Investments Corp. (P28.75 billion), Cebu Air Inc., (P26.83 billion) and Robinsons Retail Holdings Inc. (P26.79 billion).

Converge ICT is the second company to list at the Philippine Exchange this year after MerryMart Consumer Corp.

Topics: Converge ICT Solutions Inc , initial public offering , Thornburg Investment Management Inc ,
COMMENT DISCLAIMER: Reader comments posted on this Web site are not in any way endorsed by Manila Standard. Comments are views by manilastandard.net readers who exercise their right to free expression and they do not necessarily represent or reflect the position or viewpoint of manilastandard.net. While reserving this publication’s right to delete comments that are deemed offensive, indecent or inconsistent with Manila Standard editorial standards, Manila Standard may not be held liable for any false information posted by readers in this comments section.
AdvertisementKPPI
Advertisement