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Cemex asked to give more details on IPO

by June 12, 2016 General

The Securities and Exchange Commission asked for more “material information” from cement manufacturer Cemex Holdings Philippines Inc. on its planned P40-billion initial public offering.

SEC spokesperson Armando Pan Jr. confirmed that while the SEC en banc approved Cemex Holdings’ IPO last week, the corporate regulator had yet to issue a pre-effective letter to the local unit of the Mexican cement company.

Cemex Holdings needs a pre-effective letter to conduct  investor roadshow to drive interest in the  maiden share sale.

SEC sources said the corporate regulator had raised two main points of concern which were considered material information on the planned public offering.

Sources said the material information could result in amendment to Cemex Holdings’ registration statement filed with the SEC. Cemex Holdings will be given 10 days to make the clarifications.

After getting SEC approval, the cement firm needs to also secure an approval from the Philippine Stock Exchange, which would enable it to set the final timetable for the offering.

Documents filed with the SEC showed that Cemex Holdings would sell 2.032 billion common shares at an offer price of up to P17 apiece to raise as much as P34.56 billion in proceeds.

Some 304.94 million shares were set aside for over allotment in case of oversubscription, which could increase total proceeds to P39.74 billion, making it among the largest IPOs in the country. Data showed Cemex Holdings aimed to use the proceeds for the repayment of up to $504 million of short-term loan from related third party New Sunward Holdings B.V. which was used to acquire operating subsidiaries Apo Cement Corp. and Solid Cement Corp.

Documents showed of the 2.337 billion shares, up to 1.423 billion shares worth P24.2 billion would be sold to overseas investors while the remaining 609.89 million shares worth P10.36 billion would be set aside to domestic investors.

Citigroup Global Markets Limited, The Hongkong and Shanghai Banking Corporation Limited, Singapore Branch and J.P. Morgan Securities PLC are the joint global coordinators and book runners while BDO Capital & Investment Corp. is the domestic lead underwriter.

Cemex Holdings said it planned to spend P2.4 billion for capital expenditures in 2016, including P600 million for maintenance of existing cement facilities.

Cemex Holdings is a newly formed subsidiary of Cemex Asian South East Corp., which is wholly owned by Cemex España, S.A., which in turn is indirectly owned by Cemex, one of the largest cement companies in the world based on annual installed cement production capacity.

It operates two cement plants with aggregate installed annual capacity of 5.7 million tons as of end-December 2015.

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