MEGAWIDE CONSTRUCTION Corp. is raising funds through the issuance of up to P5-billion new preferred shares to support its pipeline of expansion plans.
In a statement on Tuesday, the engineering firm said it filed an application with the Philippine Stock Exchange to issue P3-billion new preferred shares, which will have an oversubscription option of up to P2 billion.
It has tapped RCBC Capital Corp. and PNB Capital Corp. as joint lead underwriters for the plan, with a target of completing the fund raising by November.
“We see significant opportunities in both our organic and external pipeline amid the challenges emerging from the health crisis,” Megawide Chairman and CEO Edgar B. Saavedra said in the statement.
“We are very thankful to our partners for arranging this facility and gathering together the sources and users of fund, especially in this critical yet exciting stage for the company,” Mr. Saavedra added.
Proceeds from the offering will be funneled to Megawide’s expansion plans, particularly the 1.7-hectare Phase 2 of its transport terminal Paranaque Integrated Terminal Exchange, the initial design stages of its multi-use development at the Mactan Cebu International Airport (MCIA), and the expansion of its capacity for pre-cast concrete.
The company also has proposals to expand MCIA, rehabilitate Ninoy Aquino International Airport in Pasay City, and redevelop the Carbon public market in Cebu City, which may benefit from the proceeds of the issuance.
“We also want to take advantage of this window of opportunity for investors who are searching for attractive investment alternatives and for projects that offer significant value,” Mr. Saavedra said.
Megawide currently has 2.4 billion listed shares and a free float level of 32.98%. In February, it offered P5-billion corporate notes to retire maturing debts and fund growth projects.
The company booked an attributable net loss of P289.63 million in the first semester, reversing last year’s profit of P585.86 million, as it became unprofitable in the second quarter due to travel and construction bans during the coronavirus-related lockdown.
Shares in Megawide at the stock exchange dropped nine centavos or 1.26% to close at P7.08 each on Tuesday. — Denise A. Valdez
Clarification: This story has been updated to reflect the amended stock exchange disclosure of Megawide on Wednesday. The previous version of this story said the company plans to issue up to P8-billion new preferred shares, composed of P3-billion preferred shares and an oversubscription option of up to P5 billion.