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Cebu Landmasters’s IPO oversubscribed

June 2, 2017

From Business Mirror

A strong demand from investors led to the oversubscription of Cebu Landmasters Inc.’s (CLI) initial public offering, one of the lead underwriters said.

“We saw a very strong demand coming in during the offer period from institutions, brokers and retail clients,” said Ed Francisco, president of BDO Capital and Investment Corp., the joint lead underwriter and bookrunner along with BPI Capital Corp. “Because of this, we sold the overallotment shares for this initial public offering. Even then, we are already oversubscribed and more orders are coming in.”

The shares sold include the overallotment option of 75 million shares, which were on top of 505 million firm shares. The shares were priced at P5 each, bringing the total offer size to P2.9 billion.

“We are quite pleased with how the market has responded to this issue despite being offered in the market together with another great company,” Francisco said. “But given CLI’s unique investment proposition as a pure VisMin play on real estate and infrastructure, coupled with its attractive growth prospects, we feel CLI will be a worthwhile investment and an asset to our capital markets.”

The shares were sold from May 19 to 26. The target listing date will be on June 2.

Proceeds from the sale will be used to fund the expansion of this homegrown Cebuano property firm, founded by industry veteran Jose Soberano III in 2003.

“We like Cebu Landmasters. It is a beneficiary of a strong demand for housing in the faster-growing areas of the VisMin region,” said April Tan, head of research of COL Financial. “It also has a strong track record in execution, given the experience of Mr. Soberano in real-estate development, his familiarity with the Visayas region, and his hands-on involvement in the company and its projects.”

Tan also noted Cebu Landmasters’s “impressive track record of fully selling out all its projects within one year of launch and turning over projects within three years  of acquisition”. It has now become the second-largest developer in Cebu “despite being a relative newcomer”.