OceanaGold (Philippines) Inc. started Monday the initial public offer of common shares, representing a combined 20 percent stake in the gold and copper producer, that will raise P6.08 billion. The public offer will end on May 6.
The mining company has priced the IPO shares at P13.33 each after a book-building process that involved global and Philippine-based institutional investors.
OceanaGold (Philippines) operates the Didipio gold and copper underground mine located in north Luzon. Its mine is operating under the Financial or Technical Assistance Agreement with the government in 1994, renewed for another 25 years in 2021. A provision in the FTAA requires OceanaGold (Philippines) to pursue an IPO.
Lawyer Joan Adaci-Cattiling, OceanaGold (Philippines) president and general manager for external affairs and social performance, called the company’s IPO a milestone in the local mining industry since it is the first IPO of the extractive industry in a decade.
“We have received strong interest to-date from both local and international institutional investors and we look forward to now opening up the IPO to local retail investors. The listing on the PSE represents our strong commitment to our communities, local government units, the national government and our many other stakeholders. This is an opportunity for Filipino investors to join our exciting growth story and to align with our purpose of mining gold and copper for a better future,” he said.
BDO Capital & Investment Corp is acting as global coordinator, domestic underwriter and bookrunner for the IPO with CLSA Ltd. acting as international underwriter.
BDO Capital & Investment Corporation president Eduardo V. Francisco said the Didipio mine is the second largest producer of gold and copper and an established, low-cost, long-life, operating mine with a long history of generating strong free cash flow.
Francisco said the company’s dividend policy targets a distribution of 90 percent of free cash flow. Subject to market and operating conditions and using the 2025 estimated free cash flow based on the reserves only mine plan, at an assumed gold price of USD1,910 per ounce, the mine is expected to generate a free cash flow yield of approximately 14.8 percent while the expected dividend yield is approximately 13.3 percent, respectively.
OceanaGold (Philippines) is a wholly-owned subsidiary of OceanaGold Corporation.
