Vol. XXII, No. 14 [ BusinessWorld Online ]
Thursday, August 14, 2008 | MANILA, PHILIPPINES
LISTED ATR KimEng Financial Corp. plans to raise money by selling more shares to fund its expansion plans, which analysts said would more likely attract investors.
In a disclosure, the company said it would issue up to 230 million common shares, to be offered at P2.70 apiece.
ATR KimEng said it would use P623 million in expected proceeds to finance the expansion of its capital market, insurance, lending and real estate operations in the region.
In an interview, Executive Vice-President Renato L. Leveriza, Jr. said the expansion was in line with its new responsibility as the official representative of Singaporean brokerage Kim Eng Group to its Asian branches.
In July, the Singaporean brokerage tapped subsidiary ATR KimEng Capital to act as its official representative in handling the corporate finances of its Asian branches. The Kim Eng Group has offices in Vietnam, Indonesia, Taiwan, Hong Kong, Thailand, New York, London and India.
"Right now, it is being studied whether the company would set up an office or just fly in and out [of the country] for specific deals," Mr. Leveriza said.
"As global financial institutions reduce their capacity to do deals in the ASEAN (Association of Southeast Asian Nations) region, the Kim Eng Group hopes to increase [its] share of cross-border corporate finance activities, with ATR KimEng carrying the load of the work," ATR KimEng Financial President Manuel N. Tordesillas said.
He added this presents an opportunity for a domestic investment house like ATR KimEng Financial to enter into more regional deals and diversify its markets and sources of revenues.
"In the meantime, this will enhance our position as the only domestic investment house capable of doing cross-border deals," Mr. Tordesillas said.
Analysts said foreign investors would more likely be attracted to the share sale, although some local investors might subscribe to the shares.
"ATR KimEng has extensive businesses, although the sentiment would be better if the market was strong," an analyst said.
The sale of the shares will increase the company’s outstanding shares to 923 million from 692.5 million. It will also hike its consolidated equity to shareholders to P2.49 billion from P1.87 billion as of last year.
The sale is also expected to expand the company’s shareholder base and enhance the liquidity of the stock and make it more attractive.
"In this regard, ATR Holdings, Inc. is making available 46 million shares out of its stock rights entitlement for offering to the general public," the company said.
This will increase public ownership of the company to 17.22% from 12.22%, with the balance held mostly by ATR Holdings and Kim Eng Holdings Limited of Singapore. — Kristine Jane R. Liu
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