MerryMart Consumer Corp. closed its maiden listing up 50 percent at P1.50, from its initial public offer (IPO) price of P1.
The company offered to the public 1.59 billion common shares at an offer price of P1 each, which ran from May 27 to June 5, 2020. PNB Capital and Investment Corp. served as the sole issue manager, lead underwriter and sole bookrunner.
The offer was twice oversubscribed.
The company generated P1.59 billion in proceeds, of which P1.03 billion will be used for capital expenditures and initial working capital for store network expansion, and P220.9 million for investments in distribution centers, among others.
Finance Secretary Carlos Dominguez III, who was the guest of honor in the company’s listing ceremony, said MerryMart’s IPO amid the coronavirus pandemic “illustrates strong trust and confidence in an early and strong recovery of the Philippine economy from this global health crisis.”
Dominguez said the IPO of the MerryMart retail chain “is a good sign for the country’s economic recovery as it represents an opportunity for investors to participate in the strong growth we anticipate in the coming period.”
“This initial public offering signals trust in our good economic prospects. It shares in the optimism that, notwithstanding the global downturn engulfing us today, the Philippine economy has the fundamentals to rise quickly from the devastation wrought by the pandemic,” Dominguez said.
“It is also a sterling example of how the government and the private sector can work together to inspire public confidence in our ability to quickly recover from the crisis,” he added.
MerryMart, a venture by DoubleDragon Properties Corp. chairman Edgar Sia II, currently operates seven branches. It looks to have 1,200 stores by 2030 with P120 billion in annual systemwide revenues.
Speaking during the listing ceremony, Sia said MerryMart’s IPO is the company’s way to share its growth with investors.
“To list when the company is still small on its first few years, then bring along investors mostly retail ones, to be with you during the hyper growth years. That way you share the value of the company to tens of thousands of many small other investors that you don’t know,” Sia said.
“An entrepreneur must not be greedy enough to just share the company when he thinks there is limited growth left for the company to grow in the next 10 to 20 years,” he added.
Ramon Monzon, Philippine Stock Exchange (PSE) president, expressed hope the listing of MerryMart “will encourage more entrepreneurs to do the same.”
“PSE is currently reviewing and revising its listing rules to make the equities market more accessible to small and medium enterprise owners,” he said.
