Megawide Construction Corporation reported that its shareholder Citicore Holdings Investment Inc. has subscribed to 13.5 million of Megawide’s Series 3 preferred shares.
In a disclosure to the Philippine Stock Exchange, the firm said this serves as initial subscription for the increase in the authorized capital stock of Megawide.
Megawide earlier entered into a Subscription Agreement with Citicore under which Citicore formally subscribed to 13.5 million preferred shares of Megawide at P1.00 each, and paid 25 percent of such subscription in cash, amounting to P3.375 million.
Megawide is raising up to P5 billion in fresh funds from the capital markets through the issuance of new preferred shares. It is planning to issue P3.0 billion worth of its preferred shares with an oversubscription option of up to P2.0 billion.
“We see significant opportunities in both our organic and external pipeline amid the challenges emerging from the health crisis,” said Megawide Chairman and CEO Edgar Saavedra.
He added that, “We are very thankful to our partners for arranging this facility and gathering together the sources and users of fund, especially in this critical yet exciting stage for the Company.”
The proceeds from the issuance will be used to fund its runway for growth program, which primarily includes the development of the 1.7-hectare Lot 2 at the Paranaque Integrated Terminal Exchange (PITX), expansion of its pre-cast capacity, and initial design stages for the Mactan Cebu International Airport (MCIA) multi-use development.
Other projects in the Company’s pipeline include the Original Proponent Status (OPS), in various stages of approval, for the MCIA Expansion Proposal, Carbon Market Redevelopment, and the NAIA Rehabilitation Project.
Megawide believes that the government’s continued support to jumpstart the economy through the relaxation of credit, together with stable inflation and foreign exchange rate scenarios, will support a favorable interest rate environment for the instrument’s pricing, which will be determined on issue date
“We also want to take advantage of this window of opportunity for investors who are searching for attractive investment alternatives and for projects that offer significant value,” Saavedra added.
He noted that, “At the end of the day, we believe that all sectors – the public sector, private companies, and financial institutions – should come together for businesses to recover quickly. After all, we all share the single objective of economic progress and national development as we pursue our vision of a First-World Philippines.” RCBC Capital Corporation and PNB Capital Corporationare the joint lead underwriters for the capital raising exercise, which is targeted to be completed by November this year.