Posted: June 22, 2022, 9:53 a.m.
Last update: June 22, 2022, 10:09 a.m.
As Enrique Razon continues to boost the casino industry in the Philippines, the country’s second richest man is scrambling to push one of his other big businesses forward. It wants to go public with Prime Infrastructure Capital, its infrastructure and holding company, and is preparing for a planned initial public offering (IPO).
If Razon is successful, the Philippines could see its largest initial public offering (IPO) this fiscal year. Prime Infrastructure intends to raise up to PHP28 billion ($515 million) through the sale of 1.93 billion shares, according to Reuters. This includes an over-allotment option at a maximum price of PHP 14.60 ($0.27) per share.
IPO prices in Philippine filings are usually higher than final sale prices. Therefore, there could be a reduction in the number of shares available before the launch of the IPO.
Razon Eyes October IPO
If regulators approve the move, it could target October as the offering period for listing on the Philippine Stock Exchange. This exchange has already seen seven listings this year.
Razon, 62, has a net worth of $6.7 billion. He made his fortune through the Bloomberry casino group, as well as the global port operator International Container Terminal Services.
This month, Razon announced that it had acquired a majority stake in the South China Sea gas field from Dennis Uy. The latter is another tycoon and supporter of former President Rodrigo Duterte. Uy went on a selling spree after the last election, offloading a number of assets.
Additionally, Razon buys a stake in Uy’s Clark Grand Leisure Corp. The company is in the process of building a property in Pampanga, but currently has no plans to include a casino. He returned his license last year. However, Razon could still push for reinstatement.
Prime Infrastructure is currently building the largest solar power plant in the world. It will have a capacity of between 2,500 and 3,500 megawatts (MW) and a storage system that can store 4,000 to 4,500 megawatt hours of energy. According to data from the US trade group Solar Energy Industries Association, that means enough energy to power 656,000 homes.
Bloomberry on the rebound
Earlier this month, Bloomberry received a boost from industry analysts. After the company announced a better performance for the first quarter of the year, analysts at Morgan Stanley raised their earnings estimates.
Bloomberry could see its 2022 EBITDA (earnings before interest, tax, depreciation and amortization) approach 71% of its 2019 performance by the end of the year. This involves a total of around PHP 14 billion ($267.6 million).
This year marks Bloomberry’s first profit since the start of the COVID-19 pandemic. The company posted a net loss in the same quarter last year of PHP 780.8 million ($14.35 million). This follows a loss of PHP 1.3 billion ($23.98 million) in the previous quarter.
In February, the Philippines opened its borders to vaccinated tourists. As a result, casinos across the country have been given permission to reopen at full capacity as the government eases its anti-COVID-19 measures.
Morgan Stanley analysts expect Bloomberry to top its 2019 EBITDA by 2024. The operator’s projected profits could top PHP25.2 billion ($481.5 million), up 127% from its 2019 level.