Philippines F&B Kiosk Operator Fruitas Files For $23m IPO

Fruitas Holdings Inc (Fruitas), a food and beverage kiosk operator in the Philippines, has filed to raise up to 1.2 billion pesos ($23 million) in an initial public offering (IPO) with the local Securities and Exchange Commission (SEC).

The IPO application comes less than a week after Metro Pacific Hospitals Holdings Inc, the largest hospital chain in the country, filed to raise as much as $1.6 billion in an IPO.

In a statement, Fruitas said it plans to offer up to 533.66 million primary common shares with an over-allotment option of up to 68.34 million outstanding common shares at a maximum price of 1.99 pesos each.

Based on those figures, the company expects gross primary proceeds of up to 1.06 billion pesos ($20.4 billion) and the total IPO to reach 1.2 billion pesos. It has appointed BDO Capital & Investment Corp. and First Metro Investment Corporation as joint issue managers, joint bookrunners, and joint lead underwriters for the offering.

Subject to regulatory approvals, Fruitas intends to run the offer period from November 18 to 22 and targets to list before the end of the year.

Founded in 2002, Fruitas has grown to over 900 stores all over the country and over 20 brands in its portfolio. The statement showed that the group has aggressively expanded from more than 400 stores as of end of 2016 to 949 stores as of Jun 30, 2019.

In 2018, Fruitas reported 1.58 billion pesos ($30.4 million) in consolidated revenue, a 37 per cent increase from its P1.15 billion ($30.5 million) revenue in 2017, which it said was driven by strong performance of its stores.

It intends to use the proceeds from the IPO to fund its store network expansion and improvement, acquisitions, expansion of its food park business, and debt repayment, among others.

“The proceeds will be used to fund our store network expansion across the Philippines and expand our commissary to serve more customers,” said Fruitas President and CEO Lester Yu.

New capital will be used towards the acquisition of food service businesses and the introduction of new concepts that have a strategic fit with the company’s operations, Yu added.

“We view the potential listing on the Philippine Stock Exchange as part of our growth journey and are excited to have taken the first step by filing our registration statement,” he said.

Other F&B companies that are listed on the PSE are Jollibee Foods Corporation, Shakey’s Pizza, Max’s Group Inc, San Miguel Food and Beverage, and Century Pacific Food.

Last week, Metro Pacific Hospitals Holdings said it plans to sell as much as 457.86 million shares, including the over-allotment option, at a maximum price of 182 pesos ($3.47) per share.

At that price, the hospital group could raise as much as 83.33 billion pesos ($1.6 billion), but price ceilings cited in Philippine IPO filings are tentative.

The two filings could help revive the local market. The PSE has long been considered Southeast Asia’s worst-performing bourse.

After falling 15 per cent last year, the exchange hopes to recover this year with a string of listings ahead, including the $405-million IPO of ALL Home Corp, the home improvement chain of the country’s richest person, Manuel B. Villar Jr.

In July, Kepwealth Property Phils, a former subsidiary of Singapore-based Keppel Corporation, has received the go-ahead from the PSE for a listing in which it seeks to raise up to $7.5 million.