Hybrid rice producer plans P8-B IPO

MANILA, Philippines - Hybrid rice and seed producer SL Agritech Corp. plans to pursue an initial public offering (IPO) by the second half of 2017, aiming to raise up to P8 billion.

“We are looking at selling as much as 25 percent of the company. We want to raise P7- to P8-billion,” SL Agritech chairman Henry Lim said.

Lim said SL Agritech was able to expand its operations in the last two years, prompting the company to revive its IPO plans.

Proceeds from the offering would be used to fund the company’s expansion.

“We want a lot of people to have a share of what we are doing. With the participation of the public, we can expand more,” Lim said.

Lim said the expansion is line with Agriculture chief Emmanuel Piñol’s plan to boost the production of hybrid rice.

“He said the target is one million hectares, but I think the budget for this year is not enough because they will need P5 billion for that,” Lim added.

The company earlier said it was looking to double its farm area planted with hybrid variety to 500,000 hectares for crop year 2016-2017.

The target area expansion will coincide with the expected increase in imports,  particularly the Doña Maria rice variety to one container per shipment or around 18-20 metric tons (MT) per day.

SL Agritech currently ships only five to six containers on a monthly basis to countries in Europe, Middle East and the US, among others.

Lim said Malaysian and Singaporean private firms have expressed their intention to import SL Agritech’s Doña Maria premium rice.

At present, SL Agritech holds 70 percent of the total market share of hybrid variety in the Philippines.

It is one of the large hybrid rice producers in the country. It produces the Dona Maria brand of premium rice in Miponica and Jasponica varieties.

The company has various partnerships for hybrid rice seed production in Asian nations such as Vietnam, Bangladesh, Indonesia, and Cambodia.