Puregold raises P4.7 billion via top-up placement

MANILA, Philippines — Puregold Price Club Inc., the retail chain owned by Lucio Co, has raised P4.7 billion in a top-up placement to fund its capital expenditure requirements and other funding needs.

In a disclosure yesterday, Puregold said that it sold approximately 104 million common shares at a price of P45 per share.

A top up placement means that major shareholders place their existing shares with independent persons, then subscribe for additional new shares. 

A broker usually helps identify interested investors. In a top-up placement, the new shares’ issue price cannot be lower than the old shares’ price.

“Use of proceeds will be used for general corporate purposes, capital expenditure, and potential acquisitions. The sale shares represent approximately 3.8 percent of Puregold’s total issued and outstanding stock,” Puregold said.

The deal was done via an overnight book built offering with Co as the sole selling shareholder.

The shares were sold to local and foreign investors.

“The shares sold by Co represent part of his indirect holdings of Puregold lodged with Deutsche Regis Partners Inc.,” Puregold said.

The placement price is equivalent to a 6.8 percent discount from its last close of P48.30 as of Jan. 16.

The company tapped Deutsche Bank AG as the placing agent for the transaction.

Puregold is committed to continuously expand its footprint, carrying on from its strong performance last year.

It reported a consolidated net income of P4.62 billion in the nine months to September last year, up 18.4 percent .

Puregold stores registered stronger than expected same store sales growth (SSSG) of 5.8 percent during the period while S&R registered a SSSG of 8.8 percent.

Net sales increased 14 percent to P99.8 billion

The company is eyeing a 12  to14 percent growth in sales for 2018.

As of the end of September last year, the Puregold group had a total of 397 stores nationwide -- 345 Puregold stores, 16 S&R membership shopping warehouse and 36 S&R New York Style QSR.