Cebu Pac standing by P95 indicative price for IPO

Cebu Air Inc. which operates budget airline Cebu Pacific, will be standing by its original indicative maximum price of P95 per share despite uncertain market conditions. Jose Pacifico Marcelo, vice president of Cebu Air's underwriter First Metro Investment Corp. reporters that the airline operator is still looking at P6.6 billion in net proceeds from the P95 per share that it has stated in its prospectus filed with the Securities and Exchange Commission and the Philippine Stock Exchange. “Mr. (Lance) Gokongwei, (Cebu Air president), told investors that the company will be sensitive to the market feedback (in pricing its shares)," Marcelo said. Cebu Air starts its international roadshow Tuesday. Company officials will be visiting Hong Kong, Singapore, London, Boston, New York, and San Francisco. Cebu Air will set the offer price for its shares on January 25 and is set to list in the PSE on February 8. Cebu Air will be selling up to 72.025 million primary shares while existing shareholders will be selling 63.43 million shares at an estimated amount of P95 each. The company has appointed UBS Investment Bank as the sole international underwriter, sole book runner and lead manager for the offering and ING Bank N.V.the other domestic lead underwriter. The company has also allocated 20,318, 475 shares for over-allotment option; 1.5 million shares for employees stock purchase plan; and 10.225 million shares for its executive stock option plan. The company’s existing common shares total 251.25 million. Of the offer shares, 94.82 million or 70 percent will be offered to international investors while 40.64 million or 30 percent will be for domestic and local small investors. Of the net proceeds, the company said it will be using some P3 billion for aircraft-related payments; P941.5 million for pre-delivery payments of aircraft such as Airbus and ATR and spare engine purchases; P939.6 million for working capital and other general corporate purposes and P1.755 billion for payment due to related parties. - Cheryl Arcibal, GMANews.TV