Converge ICT IPO timed right

- Advertisement -

Communication Technology Solutions Inc. (Converge ICT) has timed its initial public offering plans to the shift to offsite productivity such as work from home and online classes, among others, capitalizing on the need for a steady supply of data, market analysts said.

The company looks to raise as much as P36 billion through an initial public offering, the proceeds of which will be used to expand its fiber network rollout outside Luzon to cover the country.

The company plans to offer to the public a total of 1.5 billion shares divided into an initial 1.3 billion primary and secondary shares and another 195.19 million common Shares to cover the greenshoe option, at an offer price of up to P24 per share.

- Advertisement -

Shareholders Coherent Cloud Investments B.V., and Comclark Network and Technology Corp. are selling 885.61 million shares of its stake in Converge ICT Solutions as part of the primary offer. At present, Converge ICT Solutions is 70.79 percent owned by Comclark and 29.03 percent owned by Coherent Cloud.

“Commerce, education, and other economic activities are tilting towards the digital space.

Many companies are seen to ramp up their digital transformation to strengthen their operations amid the distancing measures in place. This ongoing shift in the economy offers a lot of opportunities to our data service providers,” said Japhet Louis Tantiangco, Philstocks Financial Inc., analyst.

This shift, which Tantiangco called “a silver lining is seen for the telecommunications sector amid the new normal brought by the COVID-19,” demands for more capital infused into putting up infrastructure for more data supply.

“The company is yet to establish their ground in the Visayas and Mindanao region giving them further room for growth. Majority of the net proceeds of the company’s primary share sale would go to capital expenditures which in turn would be supportive of their nationwide aim,” Tantiangco said.

Author

- Advertisement -

Share post: