Investors scramble for Shakey’s IPO shares

MANILA, Philippines - Investors have gobbled up the initial public offering (IPO) of popular pizza chain Shakey’s Pizza Asia Ventures Inc., which is set to list on the Philippine Stock Exchange on Dec. 15.

The deal is already more than three times oversubscribed, said Ed Francisco, president of BDO Capital and Investment Corp., one of Skakey’s underwriters.

SPAVI, a leading full-service restaurant owned by the Po family, has set the IPO price at P11.26 per share or the top end of the pricing range of P10.70 to P11.26 each share.

Vicente Gregorio, president and CEO of SPAVI,  said investors believe in the growth story of Shakey’s.

 “The company is already 41 years old,” Gregorio said.

Shakey’s launched the IPO in an investors’ briefing yesterday with the offer period to run from today until Dec. 8.

SPAVI chairman Christopher Po said the response from investors was both overwhelming and humbling.

“We just came from a roadshow in Singapore and (investor response) was pretty overwhelming in spite of challenging market conditions. The market is pretty well covered,” Po said.

He said Shakey’s is a brand that is relevant to almost all socioeconomic classes in the Philippines and to all ages.

“For 40 years it’s been creating good times and good food for millions of Filipinos so we’re very excited,” Po said.

At P11.26 per share, SPAVI seeks to raise up to P4 billion from the IPO which will be used for debt repayment, capital requirements and strategic acquisitions.

 According to the prospectus filed with the SEC, the company will sell up to 352 million primary and secondary shares, including an over allotment of 46 million shares to cater to extra demand.

 Filipino-Chinese businessman Ricardo Po Sr., the family patriarch, who was present during yesterday’s briefing welcomed the positive reception from investors.

 SPAVI is majority owned by the Po Family’s Century Pacific Group Inc (CPGI), parent company of Philippine listed Century Pacific Food Inc (CNPF).

Earlier this year, CPG and Singapore’s sovereign wealth fund GIC, partnered to acquire majority of the pizza business from the Prieto family, which continues to hold a minority stake in SPAVI.

SPAVI appointed Deutsche Bank AG as sole global coordinator and bookrunner for the deal, while BDO Capital and First Metro Investment Corp. as joint lead managers and underwriters.

Evercore is acting as exclusive financial adviser to SPAVI.

Shakey’s, recognized globally as the original pizza franchise in the US, was first established there in 1954 and is best known as “the pizza that started it all.” It first opened in the Philippines in 1975 and is famous for its thin crust pizzas and its chicken and mojos.

Locally, Shakey’s holds the number one position in the traditional full service pizza chain and family style casual dining categories. It had 177 stores all over the country as of the end of June this year, with plans to expand to greater Manila and provincial areas.

Seven more stores are expected to open before the end of 2016, with 20 more new stores in the pipeline for 2017.