2 weeks ago
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The Securities and Exchange Commission (SEC) has approved Megawide Construction Corporation’s planned public offering of up to ₱5.95 billion worth of preferred shares.
In its meeting on Feb. 25, the Commission En Banc resolved to render effective Megawide’s registration statement covering a total of 30 million Series 6 preferred shares, with an oversubscription option of up to 30 million, subject to the company’s compliance with certain remaining requirements.
The preferred shares, which are perpetual, cumulative, non-voting, non-participating, non-convertible, and redeemable, will be offered at ₱100 apiece.
Assuming the oversubscription option is fully exercised, the listed company is expected to net up to ₱5.95 billion from the offer. Proceeds will be used for the partial financing of pipeline projects, redemption of shares, and general corporate purposes.
The offer will run from March 10 to 19, with the shares to be listed on the Main Board of the Philippine Stock Exchange on March 28, according to the latest timeline submitted by the company.
The company has engaged PNB Capital and Investment Corporation, RCBC Capital Corporation, and Security Bank Capital Investment Corporation as joint issue managers, joint lead underwriters, and joint bookrunners for the transaction.
Megawide is setting a ₱1.8 billion capital expenditure budget for 2025, an increase of 50 percent over the estimated ₱1.2 billion spent last year.
In an interview, Megawide Chairman Edgar Saavedra said this year’s capex will be allocated mainly for the expansion of its real estate subsidiary as well as its construction business and its precast and construction solutions unit.
He noted that the higher capital spending this year could help the company drive its revenue growth of 20 percent to 30 percent this year on the back of its construction and real estate operations.
While declining to provide a target for net earnings this year, Saavedra expressed optimism the Megawide will outpace its sales growth in 2024.
He said that the company’s real estate arm, PH1 World Developers, is focusing on the ₱3.5 million and below housing segment to complement its middle-income housing ventures that are currently facing headwinds due to excess market supply.
Saavedra noted that PH1 broke ground on a mid-rise condominium development in Imus City in Cavite last year with similar projects set for 2025. He expressed optimism about the demand for ₱2.5 million units moving forward, which he said PH1 World is targeting.
Meanwhile, the company’s landport business, the Paranaque Integrated Terminal Exchange (PITX), continues to see increasing foot traffic and occupancy of its leasing spaces.
On the other hand, Megawide’s construction business is expected to grow with its order book steadily stood currently at ₱42.6 billion as of end-September — equivalent to two to three years’ work.
Saavedra said the construction business is expected to have a better topline and bottom line this year as problematic projects from the Covid-19 pandemic period are completed.
Looking ahead, Saavedra said Megawide is eyeing opportunities in the government’s infrastructure pipeline, particularly airport projects.
