Cebu Landmasters board approves P5-B preferred shares offering

Cebu Landmasters [CLI 2.60, up 0.8%; 142% avgVol] [link] announced that its board of directors approved a measure to sell up to P5 billion worth of its Series A preferred shares in an upcoming follow-on offering. The transaction will feature 3,000,000 “firm” offer shares, plus up to 2,000,000 shares in an oversubscription option, for a total of 5,000,000 Series A preferred shares at a price of P1000.00/share. The measure authorizes CLI’s management team to apply with the SEC and the PSE to conduct the offering and eventually list the shares on the PSE.

MB bottom-line: This is a transaction that has been in the minds of the CLI brain trust for a few years as part of a growth strategy to take CLI from a regional scope-limited developer to the big leagues. This won’t put CLI up with Ayala Land [ALI 34.50, up 1.5%; 117% avgVol] or Megaworld [MEG 2.02 unch; 102% avgVol], but it will give the group a considerable amount of capital that it can use to build up the pillars of its business model. I look forward to seeing the prospectus to get a better feel for what the company will use the money for. This is the second preferred shares follow-on offering to be announced by a 2nd tier real estate developer in 2024, after Century Properties [CPG 0.28 unch; 385% avgVol] announced that its own P5 billion preferred shares offering was approved by the SEC. The big question on my mind: what will the ticker be? For my money, I think CLIP or CLIPA are pretty fun, memorable, and flexible. 

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