A COCONUT products manufacturer is looking to raise up to P7.7 billion via an initial public offering (IPO) in October.

In a statement, Axelum Resources Corp. said it has filed an application for an IPO with the Securities & Exchange Commission (SEC) and Philippine Stock Exchange (PSE). The company did not say when the application was filed.

Romeo I. Chan, chairman of Axelum, said the company is planning to sell up to 700 million primary shares and up to 430 million secondary shares.

“We hope to raise up to P7.7 billion at a price of up to P6.81 per share. The final offer price shall be determined prior to the scheduled listing of the IPO hopefully in October of this year,” Mr. Chan was quoted as saying.

If approved, Axelum’s IPO could be one of the first to push through this year. The last company to go public at the local bourse was property developer D.M. Wenceslao & Associates Inc. in June 2018.

Axelum appointed First Metro Investment Corp. (FMIC), the investment banking arm of the Metrobank Group, as issue manager, bookrunner and lead underwriter of the IPO.

Henry J. Raperoga, president of Axelum, said the company is planning to use the proceeds to ramp up its expansion.

“The net proceeds from the primary offer will be used to fund our strategic acquisitions, expand our domestic and international distribution networks, install new manufacturing facilities for new products, and improve and expand the company’s existing manufacturing facilities. A portion of the proceeds will also be utilized to retire our loans, reduce payables, and for other capital expenditure requirements,” Mr. Raperoga said.

Asked whether there would be an appetite for the IPO, Timson Securities, Inc. Trader Jervin S. de Celis said, “Well, if the company’s plan is to use the proceeds of the IPO for business expansion then it can attract investors. Since the company is also export-oriented and sells their wide array of coconut products to international market, that makes it a factor to consider among investors who would like to diversify their portfolios.”

Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said it would be better for the company to have the IPO after the US-China trade tensions have subsidied.

“Once the trade war between the US and China is resolved… I think the IPO for this, since it’s a consumer industry, will have a good start as long as it’s on the proper timing… siguro mga (maybe around) fourth quarter pa ’yan,” he said in a phone interview.

Axelum is described as a fully integrated manufacturer of coconut products such as coconut water, desiccated coconut, coconut milk powder, and coconut cream for both domestic and international use.

Its main production facility is located in Medina, Misamis Oriental, while two manufacturing and distribution facilities are in the United States and Australia.

The company supplies its products to international food and beverage companies, confectioneries, bakeries, supermarkets, and food service industry in United States, Canada, Australia, New Zealand, Eastern Europe, Europe, Middle East, Japan, and parts of Asia.

Axelum said its direct or indirect customer-base and end-users include global brands such as Vita Coco, The Hershey Co., ConAgra Foods, Kellogg’s, Quaker, Nestlé, Russell Stover, Unilever, Kroger, Mondelez International, Ferrero, Kraft Foods, General Mills, Campbell’s, Mars, Cadbury Schweppes, and Calbee.

It also has retail products such as Fiesta Coconut Milk Powder and Fiesta Tropicale Coconut Water. — Vincent Mariel P. Galang

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