Lucio Co’s The Keepers IPO gets green light from SEC

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After several months of waiting and due diligence, the Philippine Securities and Exchange Commission (SEC) has approved the up to P7.5-billion follow-on offering (FOO) of The Keepers Holdings, Inc. (KEEPR), the wine and spirits distribution company of retailer Lucio Co.

Formerly named Da Vinci Capital Holdings, Inc., The Keepers Holdings aims to raise up to P7.5 billion from the FOO to finance the expansion of the company’s distribution operations and further enhance its product portfolio. Based on its application, the company plans to sell to the public up to 3.0 billion common shares at a price of P2.00 to P2.50 per offer share.

Pricing of the offer shares is tentatively set on October 28, with the offer period slated to run from November 8 to 12, 2021. The shares are targeted to list at The Philippine Stock Exchange, Inc. (PSE) on November 22, 2021.

China Bank Capital Corp., PNB Capital and Investment Corp., and SB Capital Investment Corp. have been mandated as the joint issue managers, joint lead underwriters and joint bookrunners for the FOO.

“The Keepers Holdings will become the only pure play, imported spirits distribution listed company in the Philippines,” said company President Jose Paulino Santamarina, who remarked that the offer is more like an IPO because they are introducing a new business to the investing public.

Proceeds from the FOO will be used to fund what Santamarina described as a multi-path expansion through horizontal and vertical integration, alternative distribution channels, and new geographic territories. These include strategic acquisition opportunities, expansion of product portfolio and distribution channels, investments in the distribution and logistics network including modernization of facilities, as well as working capital to support the expansion.

The Keepers Holdings owns and operates Montosco Inc., Meritus Prime Distributions Inc. and Premier Wine and Spirits Inc. – three of the leading players in the domestic distribution of international liquors, wines and specialty beverages. Collectively, the group distributes leading international brands such as Alfonso, Johnnie Walker, Chivas Regal, Jose Cuervo, Jim Beam, Smirnoff, Red Bull, and Jinro.

In its prospectus submitted to the SEC, the company said its board of directors has approved annual dividend payment ratio of at least 20% of its consolidated net income from the preceding fiscal year. Operating companies Montosco, Meritus and Premier, during the meetings of their boards of directors last September 2021, also approved to maintain an annual dividend payment ratio of at least 20% of its net income from the preceding fiscal year.

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