AGI corporate information officer Dina Inting told the Philippine Stock Exchange that its entry into First Centro would pave the way for other information technology-related property development ventures.
First Centro’s core asset is the P12-billion Cebu Cybertown, an IT-based economic zone accredited by the Philippine Economic Zone Authority (PEZA). It is also the developer of Ambassador Hills, a successful residential community in Parañaque, and other similar housing projects.
For his part, AGI chairman Yang said their acquisition of First Centro would contribute significantly to their revenue stream, although its earlier plans to list via an initial public offering (IPO) will be put in the backburner.
"First Centro is supposed to go public this year. In fact, it has already received the go-signal from the PSE. But with this development, it will have to defer its IPO plans."
Based on its IPO applications at the PSE, First Centro plans to offer 27 percent or 27 million of its outstanding shares at an indicative price of between P1 and P2 each.
Yang said that before going public, First Centro’s fundamentals would be further strengthened to make it more attractive to future investors. Last year, the firm made an estimated net profit of P50 million, a respectable performance for a real estate company.
To boost First Centro’s operations, Yang said AGI would set aside 30 percent or P1.5 billion out of its P5-billion capital expenditure program over the next two years just for the Cybertown project.
"We believe this is the most favorable time to invest in the property business. The economy is on a firmer footing, and we see increasing signs of renewed investor confidence. The government’s priority programs are IT and housing, which are exactly the same areas that First Centro is focused on, and that makes it a timely and strategic investment," Yang said.
Apart from Yang, AGI’s other investors include top global investors such as the Singapore-based International Advisory Group, McKesters of the US, American Growers Corp. and California Growers Investments Inc.
From a glass manufacturing company when it undertook its initial public offering (IPO) in early 1999, AGI has transformed into a holding firm for food and beverage businesses when Yang and the other investors came in later that year.
As part of the company’s restructuring, the AGI board has approved the spin-off of a P5-billion fully-owned subsidiary, Alliance Growers Holdings Inc., to "consolidate all of the company’s interest and assets in the food and beverage business."
The new capital infusion will be used to build a modern alcoholic beverage, distilled water and juice production complex in Laguna, one of the most modern of its kind in Asia. – Conrado Diaz Jr.