SSI Group readies P7.45 B public sale

MANILA, Philippines - Tantoco-owned SSI Group Inc. will be the fourth company to list on the local bourse this year following the release of a pre-effective approval of the Securities and Exchange Commission (SEC) late last week.

SSI said it is gearing up to embark on a domestic and international roadshow for the share sale exercise.

The retail offer period shall commence following the domestic and international roadshow, the firm said.

The largest specialty retailer in the Philippines, a member of the Rustans Group, intends to hold its initial public offering (IPO) between Oct. 24 and 30, with listing eyed Nov. 6.

The company’s IPO plans, however, is still subject to the Philippine Stock Exchange’s clearance.

“The maximum price of P7.50 has been set, following the strong demand received from institutional investors during the cornerstone process, and values the company at an attractive price-to-earnings multiple reflective of SSI Group Inc’s market leading position in the specialty retail industry,” said Anton Huang, SSI president.

SSI’s IPO has received strong interest so far, with the company already securing cornerstone commitments for 34 percent of the offering from well-regarded institutional investors that include Bank of the Philippine Islands Asset Management and Trust Group, Government Service Insurance System, Havenport Asset Management Pte Ltd., Macquarie Asia New Stars Fund, MLIS-York Asian Event-Driven Ucits Fund, and York Asian Opportunities Investment Master Fund.

SSI has decided to trim the maximum offer price of its share sale to P7.50 per share from a previous cap of P12.50 each.

As such, expected proceeds have been likewise reduced to P7.45 billion from the previous target of P12.42 billion.

SSI said the proceeds would be used to fund capital spending for business expansion as well as cut down debt.

The firm said P2.5 billion of the amount to be raised would be utilized to open more stores for its specialty retailing business, while P1.5 billion would be used to pay a number of financial obligations with banks.

Some P253.8 million, meanwhile, is being earmarked for Wellworth department store, a partnership with Ayala Land, and another P146.3 million for FamilyMart convenience store, a joint venture with Ayala and Itochu Corp. of Japan.

SSI intends to sell 864.23 million primary and secondary shares, with an over-allotment option of up to 129.63 million shares.

BPI Capital Corp., The Hongkong and Shanghai Banking Corp., Ltd., Singapore branch, and Credit Suisse (Singapore) Ltd. will serve as joint global coordinator and bookrunners of the transaction.

SSI is the country’s leading specialty store retailer in the country, operating 103 international brands which includes Hermès, Prada, Gucci, Burberry, Salvatore Ferragamo, Lacoste, Michael Kors, Kate Spade, Gap, Old Navy, Zara, Stradivarius, Bershka, Aeropostale, Samsonite, Nine West, Payless Shoe Source, Beauty Bar, Marks and Spencer, Pottery Barn and TWG, among others.