Sugar firm to raise P558 million from share sale

MANILA, Philippines — Central Azucarera De San Antonio Inc. (CASA), a sugar mill based in Iloilo, is embarking on a direct public offering (DPO) to raise around P558.47 million.

In its registration statement filed with the Securities and Exchange Commission (SEC), CASA said the DPO consists of 277,500 common shares at an offer price of P2,012.50 per share.

In a DPO, a company or its shareholders sells shares to increase  public ownership, but it is not required to list in the stock exchange. This is different from an initial public offering where a company sells part of the company by issuing new stocks. In an IPO, a company must list on a stock exchange.

“Net proceeds from the offer will be used to fund the upgrading of the company’s cogeneration facility, motor pool and sugar factory, as well as for land acquisition,” the company said.

The company, which is also a renewable energy developer, also needs to comply with the public float requirements under the Electric Power Industry Reform Act of 2001, which states that all private power generation companies and distribution utilities must sell at least 15 percent of common shares to the public in a period of five years.

CASA’s primary business is sugar milling, with its facilities having a maximum milling capacity of 8,000 tons of cane per day.

Its main products are raw sugar and its by-products such as sugarcane molasses.

In 2011, the Department of Energy (DOE) approved the registration of the company as a renewable energy developer of biomass energy resources covered by Biomass Renewable Energy Operating Contract no. 2011- 03-021.

The company’s co-generation plant started operations on December 23, 2007 with initial installed generation capacity of 15MW.

Since then, the company has expanded its co-generation facilities with the contemplated 8MW increase in installed generation capacity.

For the DPO, CASA engaged SB Capital Investment Corp as the issue manager and underwriter.