Posted on
July 21, 2013 09:57:03 PM [ BusinessWorld Online ]
HOTEL
OPERATOR Discovery World Corp. (Discovery World) -- owned by Tiu-led JTKC
Equities Inc. and The Discovery Leisure Company, Inc. -- hopes to conduct its
planned initial public offering (IPO) by October if market volatility subsides,
a senior JTKC official said on Friday last week.
“We’re
definitely looking (to conduct IPO) this year, as long as the market is
stable,” John Y. Tiu, Jr., vice-president and director of JTKC, told reporters
at the sidelines of a stockholders’ meeting of I-Remit Inc., where he is a
director.
Discovery
World secured last July 11 the approval of the Securities and Exchange
Commission (SEC) to go public. It filed its IPO application with the corporate
regulator last March.
It has yet to
secure separate clearance from the Philippine Stock Exchange (PSE).
In its
application with the SEC, Discovery World listed the indicative offer dates as
July 23-29 and tentative listing date of Aug. 1.
Noting
“that’s [sic] the old dates,” Mr. Tiu said the new timetable may be set during
“the board meeting next Wednesday.”
“What we’re
doing is just passing all the regulatory approvals,” he explained.
“Once that’s
over, the board will decide whether we’ll do it in September or August, or
October.”
Much, he
said, will depend on the state of the market.
The PSE
index, which had recorded 31 record highs at closing, so far, this year, has
succumbed with its peers overseas to uncertainty since officials of the US
Federal Reserve first floated late in May the possibility of scaling back by
yearend an $85-billion monthly bond-buying stimulus in the face of sustained US
economic recovery.
Improved US
economic prospects, in turn, have prompted foreign funds to junk emerging
markets which had provided havens from uncertainties in the West.
Discovery
World, the seventh company allowed to go public this year, plans to raise
P1.004 billion from the sale of 306 million shares at P3.28 apiece, Mr. Tiu
confirmed.
Proceeds will
be used to continue Discovery World’s expansion, including purchase of a property
in Coron, Palawan as well as a beach project in San Vicente in the same
province, he explained.
“We are
targeting to develop a resort in Coron; we’re still pushing through the project
in San Vicente,” Mr. Tiu said.
Development
of the Coron property, once acquired, is expected to take “one-and-a-half to
two years,” he added.
The company
also plans to expand Discovery Shores Boracay by building 12 more villas.
It also
operates Discovery Suites in Ortigas Complex, Pasig City and is “developing one
(Discovery Primea) on Ayala, and then there’s (Discovery Country Suites) a
small bed-and-breakfast in Tagaytay.”
All the
company’s initiatives are designed to capitalize on the country’s promising
tourism potentials, Mr. Tiu said. “We feel that the resorts are the best way to
expand, but we also started a company called Discovery Fleet where we’ve
invested into two boats,” he explained.
Discovery
Fleet offers cruises to waters off Batangas, Pandan Island and Coron, as well as
diving packages in Apo and Tubbataha reefs.
BANKING
SUBSIDIARY TOO
Mr. Tiu added
that JTKC’s banking arm, Sterling Bank of Asia (Sterling Bank) is eyeing to go
public in three to five years.
“I think the
momentum is there,” he said of the bank’s growth prospects, adding it still
needs to build up its assets before it finally opts to go public.
Mr. Tiu used
two other banks which went public this year as a benchmark. “It’s a question of
scale,” he explained. “I think if you look at EastWest (East West Banking
Corp.), they have about P20 billion, AUB (Asia United Bank Corp.) is not much
smaller.”
PSE’s Web
site put EastWest’s capitalization at P32.61 billion and that of AUB at P25.24
billion.
“We’re shy of
P2 billion -- it’s a long way to go,” Mr. Tiu said. “If you’re too small, the
appetite of the market wouldn’t be out there.”
Late last
year, the thrift bank was allowed by the central bank and SEC to raise P500
million “for additional capital” in the first quarter by selling shares to
existing shareholders. Regulators also approved the increase in the bank’s
authorized capital to P4 billion from P3 billion to pave the way for the share
sale, which has yet to be conducted. -- LEGR
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