By James A. Loyola
AllHome Corporation, billionaire Manuel B. Villar’s nationwide chain of home improvement and builders’ centers, is planning to raise up to P20.7 billion from a planned initial public offering.
In its registration statement filed with the Securities and Exchange Commission, AllHome said it is offering 1.125 billion new and secondary common shares with an overallotment option of up to 168.75 million shares for up to P16.00 per share.
Of the IPO shares, 750 million will be new common shares while 375 million shares will be sold by Villar’s AllValue Holdings Corporation. The overallotment shares will also be secondary shares from AllValue Holdings.
The 1.125 billion firm offer shares will comprise 30 percent of the firm’s outstanding capital of 3.75 billion shares. If including all of the overallotment shares, the IPO will be equivalent to 34.5 percent of AllHome’s outstanding capital.
Maximum net proceeds from the primary offering amounting to P11.46 billion will be used by AllHome for capital expenditures and initial working capital to fund store expansion and for debt repayment.
About 59.8 percent or P6.86 billion of the net proceeds will be used by AllHome to fund the its store network expansion plan, including site fit-out, furniture and fixtures as well as initial inventory.
“As part of our store network expansion, we plan to open up to 19 new stores in the second half of 2019 and up to 19 new stores in 2020. In addition, we are expanding AllHome Alabang to increase its net selling space from 5,845 sqm to approximately 12,340 sqm.,” AllHome said.
Meanwhile, about 39.8 percent or P4.57 billion of the net proceeds from the sale of Primary Shares will be used towards repaying outstanding short-term and long-term financial obligations.
The loans were obtained from Union Bank, Security Bank, Philippine Business Bank and AllBank and carry interest rates of 6.25 percent to 9.0 percent. These loans were obtained to fund various capital expenditures. As of March 31, 2019, the outstanding balance of loans was P4.6 billion.
“We intend to use the remainder of the proceeds from the sale of Primary Shares for general corporate purposes for existing stores,” the firm said.
Up to 20 percent of the firm offer shares will be offered in the Philippines trough stock brokers and 10 percent to local small investors. The remaining 70 percent will be offered to overseas investors.
For the offering, AllHome has named UBS AG, Singapore Branch as the Sole Global Coordinator and Joint International Bookrunner, CLSA Limited and Credit Suisse (Singapore) Limited as the other Joint InternationalBookrunners, and China Bank Capital Corporation and PNB Capital and Investment Corporation as the Local Underwriters.