By Leslie D. Venzon
MANILA, Oct. 20 (PNA) — South Korean-owned Phoenix Semiconductor Philippines Corp., which is set to debut on the stock exchange in December, will embark on aggressive expansion program to increase its client base amid greater competition in the assembly and testing segment of the semiconductor industry.
According to its initial public offering (IPO) prospectus, Phoenix Semiconductor will use the bulk of the net proceeds from the offer estimated at Php 1.59 billion mainly for the acquisition of new machinery, equipment and other capital expenditures.
“The company believes that the growth of its current business will pave the way for its potential growth with other customers in the same line of business,” it said.
In the event of the exercise of the oversubscription option, the proceeds will be used for the acquisition of machinery and production equipment and construction of building and structure for the expansion program.
“After the Offer, the company will also proceed with its expansion program that aims to increase its production capacity to cater to the needs of its prospective clients,” it said.
The company will commence with the construction of a new manufacturing facility within its 146,363-square-meter leased property at Clark Freeport Zone in Pampanga.
Projected to be completed by 2015, the facility will allow it to expand its production capacity and cater to the needs of its projected other key customers.
Phoenix Semiconductor is heavily reliant on smartphone maker Samsung Electronics, which is currently its sole customer. It supplies Samsung’s memory semiconductor requirements.
Meanwhile, the company and the selling shareholder, through the underwriter, are offering up to 324,760,000 offer shares and up to an additional 134,630,000 oversubscription offer shares.
The shares are being offered for up to Php 3.76 apiece.
The offer shares, assuming that the oversubscription option will not be exercised, will represent about up to 15 percent of the company’s issued and outstanding capital stock of 2.16 billion shares immediately after the completion of the offer.
The offer period runs from Nov. 10 to 21.
Listing and commencement of trading on the Philippine Stock Exchange (PSE) is slated on Dec. 1.
BDO Capital is the underwriter hired by Phoenix Semiconductor for the IPO. (PNA)