FIXED broadband provider Converge Information and Communications Technology Solutions Inc. (Converge ICT) made its trading debut at the Philippine Stock Exchange (PSE) Monday, October 26, 2020, becoming the second initial public offering (IPO) amid the coronavirus disease 2019 (Covid-19) pandemic.
In a statement, the company said it raised around P29.1 billion (roughly USD 600 million), including shares for overallotment option, in the “largest ever IPO in the Philippines in peso terms.”
MerryMart Consumer Corporation of tycoon Edgar Sia II was the first company to make an IPO in the midst of the pandemic, raising P1.6 billion in fresh capital in June 2020.
Dennis Anthony H. Uy, founder and chief executive officer of Converge ICT, said the IPO shows his company’s “strong operational and technological capabilities.”
“We are fully committed to building the largest fiber broadband network in the Philippines and to providing affordable and reliable high-speed internet connectivity to millions of Filipinos nationwide,” he said in a statement.
“Our extensive, proprietary end-to-end fiber broadband network will enable us to support the digitalization of the Philippine economy,” he added.
He said the IPO has attracted overwhelming interest from both international and domestic investors.
On the domestic front, the offering secured over P4.856 billion (roughly USD 100 million) of domestic demand.
On the international front, the offering was well oversubscribed and has drawn high quality investors, including Omers, Genesis, Thornburg and Macquarie.
The significant cornerstone investment of over P10.930 billion (USD 225 million) covered approximately 40 percent of the base offering, and the investments from blue- chip long-only institutional investors accounted for over 80 percent of the transaction.
Warburg Pincus, a leading global private equity firm, has been the largest and most important investor and partner to Converge ICT.
Saurabh Agarwal, managing director of Warburg Pincus, said, the fiber broadband market in the Philippines is highly under penetrated and presents a tremendous opportunity for outsized growth.
“With its successful public listing today, Converge is well positioned to accelerate its growth trajectory and further capture a substantial share of the market,” he said.
“We look forward to continuing our active partnership with the company and expect to work closely alongside the founders and its very talented management team to build the largest high-speed fixed broadband operator in the Philippines,” he added.
Converge ICT said it has captured over 55 percent of the total residential fixed broadband market subscriptions since 2018.
In the first half of 2020, the company reported P6.5 billion in revenues, a 65 percent growth over the same period last year. (Marites Villamor-Ilano/SunStar Philippines)