"As far as we are concerned, we are not yet ready," Caltex country chairman Nick Florio told reporters recently. He said they will indicate in their next quarterly report to Energy Secretary Vincent S. Perez the factors why they think it is not yet time for them to offer their shares to the public.
"In January, we may submit our report expressing our position for further deferment of the IPO," Florio said, noting that the company’s financial performance was below expectations.
He said they have cut their income projection for 2001 by almost half from the original target of P1 billion to only P500 million to P600 million.
Florio said they would include in their report the overall economic situation; the status of the stock market, particularly the performance of Petron Corp., the only listed oil company in the local stock exchange; overview of the performance of the local and international financial market; and inflation rate.
But Florio said the company is ready to undertake the IPO as soon as the market stabilizes. "We already have our financial advisor (JP Morgan-Chase Manhattan) to handle the offering," he said.
According to Florio, they have been informing the DOE of the status of the stock market for the past months now through a regular quarterly report as part of their compliance to the implementing rules and regulations (IRRs) of the Oil Deregulation Law.
For their part, Shell country chairman Oscar Reyes echoed Caltex’s position in an earlier interview. "We have to study the performance of (the stock) market carefully. We can’t just offer our shares to the public," Reyes said.
Energy Secretary Vincent S. Perez appears to be understanding of the oil firms’ request for IPO deferment.
In recent interviews, Perez hinted that they would review the IPO plans of Shell and Caltex in the first three months of next year.
Perez shared the view that the IPO of the oil companies should be done in such a manner that both the public and the oil firms will gain from the process.
"I think, we are going to revisit the plan in the first quarter of 2002. Bad market conditions are prevailing right now. How can we attract investors if we are in this situation," Perez said.
According to him, the oil companies have more important issues to resolve than the IPO.
"I believe we should be focusing more on the oil depot," he said, noting that the oil firms need to concentrate on issues such as the transfer of their oil terminal outside Manila.
Under the Oil Deregulation Law of 1998, local oil refiners are mandated to list at least 10 percent of their shares in the Philippine Stock Exchange within three years of its passage.
The IPO of Shell and Caltex should have been done last February but the two oil firms asked for an indefinite extension. – Donnabelle Gatdula