SEC approves IPO of Tambunting subsidiary

The Securities and Exchange Commission (SEC) has approved the initial public offer of Tambunting Financial Services Inc., a family-owned holding company.

Turning to the capital market for funds, TFS is planning to raise P26.78 million to finance the expansion of its loan facility and pawnshop branches.

TFS was formed on June 26, 1997 by Antonio Tambunting, Hideliza Ongsiako, Milagros Puyat and their respective children as a wholly-owned subsidiary of TFS Holdings, a corporation, formed to engage in general multi-finance services, including pawnshop brokerage and consumer finance services.

TFS is planning to offer 30 million new shares at P1.05 per share to raise P31.5 million. The offer price is based on a price/earnings multiple of 7.86 times the company’s fully diluted earnings per share of P134. The company’s shares will be listed at the small and medium enterprise board of the Philippine Stock Exchange.

While only a portion of net proceeds will be disbursed, the balance shall be invested in short-term liquid instruments such as money market placements. The Tambunting pawnshops have been one of the most successful players in the industry, enjoying the most-recognized names in the pawnbroking industry, particularly in Metro Manila.

They provide loans as low as P100. Borrowers deposit with the pawnshop an item of value, typically jewelry or appliance, as collateral for the loan.

Skilled appraisers present in each branch are responsible for valuing the pawned items to determine the amount of loan to be granted to the borrower, usually based on the market value of the collateral’s raw material, mostly gold.

The Tambunting family pawnshop network expanded from four branches in 1961 to over 400 branches as of June 30, 2001, of which the TFS pawnshop network comprise 50 branches, 44 of which are located in Metro Manila and six in the provinces of Central and Northern Luzon. During the same period, TFS pawnshops had a consolidated loan portfolio of P80.87 million and total assets of P133.22 million. Revenues amounted to P33.68 million. – Des Ferriols