The Securities and Exchange Commission approved the P5.40-billion initial public offering of gadget retailer Upson International Corp.
Based on its latest regulatory filing, Upson will sell up to 986.842 million shares at an offer price of P5.50 apiece.
The offering consists of 789.472 million primary shares, 98.684 million secondary shares and 98.684 million over-allotment shares.
The offer period will be from Feb. 22 to 28, subject to regulatory approvals. Listing date was tentatively set on March 7.
Upson announced in September that it was delaying its planned maiden share offering to the first quarter of 2023 because of the volatile market conditions.
Stocks, however, began to surge in October on expectations the US Federal Reserve would gradually temper its interest rate hikes.
Analysts said that in the Philippines, the stock market entered the bull market on Friday, with the benchmark PSE index rising by more than 20 percent from October.
Upson, which offers retail products through stores like Octagon Computer Superstore, Micro Valley and Gadget King, said it would use the proceeds from the IPO to expand its store network and widen its geographic reach.
It said that from 200 branches as of end September 2022, it was planning to add 250 branches over the next five years.
This will double its total retail space to about 50,000 square meters by 2027 from 24,687.20 sq. m. as of end-September 2022.
It plans to open 50 new stores in cities with high-growth potential this year.
Upson said to support its aggressive store expansion, it would also build nine additional warehouses and distribution facilities and strengthen its delivery fleet.
“We plan to explore acquisition opportunities to deepen our market-leading position and enhance our competitiveness. We will consider acquisition targets based on synergy potential and financial performance,” Upson said.
Upson reported a net income of P237.4 million in the first nine months of 2022, up 69 percent from the same period last year.
Nine-month revenues also rose 10 percent to P7 billion from P6.38 billion a year ago.
“The slow return of foot traffic by the second and third quarter of 2022 brings encouraging opportunities that support our growth plans even more. Our 10.17 percent revenue growth in the 3rd quarter of 2022 compared to the same period in 2021 is close to our pre-pandemic performance that came with healthier foot traffic,” Upson president and chief executive Arlene Sy said.
First Metro Investments Corp. and RCBC Capital Corp. are the joint lead underwriters for the offering.
Upson will likely become the first company to conduct an IPO this year.
The PSE expects 14 IPOs in 2023.
