Discovery World becomes 4th firm to shelve IPO plan

MANILA, Philippines - The company behind upscale resort hotel Discovery Shores Boracay has shelved its P1-billion initial public offering (IPO) as it awaits several business transactions.

Discovery World Corp. requested the Philippine Stock Exchange (PSE) for a deferral of the public share sale, making it the fourth company to postpone plans to go public.

“We request for a deferment of the company’s IPO to a later date in view of certain forthcoming events that we believe will have a material positive impact on the company, its business and future prospects,” Discovery World said.

“We have decided to await these developments prior to undertaking our IPO to give prospective investors a better basis for making an investment decision relative to our share offering,” it added.

Last week, the PSE board approved the application of Discovery World for the initial listing of 764 million common shares.

Discovery World plans to sell 306 million common shares at P3.28 each to generate P1.003 billion in fresh capital. The shares represent 40.05 percent of the issued and outstanding common shares of Discovery World.

Based on the original timeline, the offer period will run from Aug. 12 to 19, which will be followed by the listing in the PSE’s main board on Aug. 29.

Discovery World, which will be the third company of the Tiu family to be listed in the PSE, tapped Abacus Capital & Investment Corp. as the issue manager and underwriter. The Tiu family owns i-Remit Inc. and TKC Steel Corp.

“The net proceeds from the offer will be used for investments in new businesses, debt retirement and working capital purposes,” Discovery World said.

Specifically, P575 million will be spent to develop a resort hotel in Palawan, refurbish boats for its cruise business and buy more shares in culinary, hotel and restaurant, and business administration institution Enderun Colleges.

The resort owner will also retire its P325-million debt while allotting P55 million for general working capital.

The company runs Discovery Shores Boracay that started commercial operations in 2007. The resort has been awarded the No. 1 Hotel Spa in Asia, Top Family Hotel in Asia, No. 2 Top Resorts in Asia and No. 5 Top Resorts in the World in 2012.

In the first quarter, Discovery World’s profits more than doubled to P14.15 million from P6.65 million a year ago. Revenues inched up to P111.54 million from P107.62 million as weaker food and beverage sales offset the improved performance of room services.

Three firms have so far debuted in the local bourse: Philippine Business Bank, Asia United Bank and Del Monte Pacific Ltd. AG Finance Inc. is set to list on Aug. 13.

However, volatile swings in the local bourse since June prompted Harbor Star Shipping Services Inc., Robinsons Retail Holdings Inc. and Travellers Hotel Group Inc. to defer their respective IPOs.