PhilNaRe sets IPO price at P3.80/share

The second company to go public this year, next to Pacific Online, is the National Reinsurance Corporation of the Philippines pegging its initial offering at P3.80 per share.

The decision to go public via an Initial Public Offering (IPO) is part of PhilNaRe''s bid to be able to compete locally and regionally.

PhilNare recently conducted an IPO roadshow at the Waterfront Hotel Lahug to give Cebuanos the chance to participate in the IPO which will run from April 16 to 20.

PhilNaRe director and president Wilfrido Bantayan said the company''s target clients are all life and non-life insurance companies. But its target market is largely domestic as it allocates 97% for domestic clients and the remaining 3% goes to international clients.

PhilNaRe chairman and GSIS president Winston Garcia said that the company hopes to dominate the region in two years and the company intends to expand particularly in ASEAN countries.

"International (clients) can buy through brokers. But for now, our focus is purely domestic." Garcia said.

Out of the 2.18 billion shares listed, PhilNaRe allocates 638 million common shares for the IPO. The listing of shares is scheduled on April 27.

The IPO proceeds will be used to increase PhilNaRe''s capital and correspondingly enable the company to increase its capacity in accepting and retaining premiums and to obtain an acceptable global rating as a reinsurer in Asian market.

The company''s plan of distribution is 40% for Institutional Investors, 30% for General Public, 20% for Trading Participants and 10% for Small Investors Program. PhilNaRe''s opening 30.7% to the public. The company''s major business lines are fire, marine and aviation, casualty and life.

The National Reinsurance is the country''s only domestic professional reinsurance firm, that provides life and non-life reinsurance capacity to the Philippines and neighboring insurance markets.

It is owned by three major institutional investors which include the Government Service Insurance System (GSIS), Universal Malayan Reinsurance Corp., and the BPI Group with 24% stake each.

This is the only Philippine-based reinsurance company that has an enormous growth in terms of Gross Premiums Written (GPW). In1979, it started with only Php 20 million in 1979. But as of 2006, the GPW is Php3.8 billion.