Zambo Norte president Jose R. Reyes Jr. said the company will either undertake an initial public offering (IPO) or seek a backdoor listing to raise needed funds.
BDO Capital & Investment Corp. has been tapped as lead underwriter while Camba, Reyes & Partners Inc. will serve as Zambo Norte’s financial adviser.
Zambo Norte signed last week a P1.8-billion engineering, procurement and construction (EPC) contract with Beijing-based China CAMC Engineering Co. Ltd. to put up a brand-new integrated sugar mill and ethanol plant in Zamboanga Del Norte.
The EPC contract calls for the design, engineering, supply of various machinery, plant and farm equipment and the construction of an integrated manufacturing complex, consisting of a sugar mill, a six-megawatt power plant and a plant capable of producing 45 million liters of ethanol a year.
Reyes said the total project cost is P2.6 billion, inclusive of the EPC contract cost.
Zambo Norte has been formed solely for the purpose of developing and undertaking the project. It intends to raise its capital to at least P1 billion.
The contract was signed by Reyes and CAMCE president Luo Yan in the presence of President Arroyo, Trade Secretary Peter Favila and Agriculture Secretary Arthur Yap during the 3rd China-ASEAN Expo and China ASEAN Business & Investment Summit in Nanning, China last week.
Based on conservative estimates, the country needs at least 15 ethanol plants to meet the demand for ethanol as blending materials for natural gasoline.
Ethanol can be produced abundantly in the Philippines, as it is a product of many starch-rich root crops like sugarcane, corn, cassava, camote and gabi.