Alphaland seeks to raise P7.8B

03/06/2011 | By: Doris Dumlao, Philippine Daily Inquirer

MANILA, Philippines—The Alphaland group of former Trade Minister Roberto Ongpin aims to raise P7.8 billion from the sale of preferred shares of a plush club that will own and operate a 424-hectare exclusive tropical island-resort in Balesin Island, Quezon.

The Securities and Exchange Commission approved last week the registration of the securities that will be offered by Alphaland Balesin Island Club Inc. (Abici), consisting of 391 primary preferred shares and 3,519 secondary shares at a maximum price of P2 million per share. Both are Class “B” shares and will be offered to foreign and local investors.

Abici is a subsidiary of Alphaland Balesin Island Resort Corp., which is wholly owned by Ongpin’s publicly listed property arm, Alphaland Corp.

The entire 2,910 shares to be offered will represent the club’s entire outstanding preferred shares and about 26 percent of its authorized capital stock of 10,000 common shares and 5,000 preferred shares (worth P1.5 million at a par value of P100 per share), SEC documents showed.

The club will be a “members only” tropical resort club with forest and marine sanctuaries and will be completed by the end of 2014. It will have 150 villas to service the accommodation requirements of members. It will also have its own fully operated airstrip and runway that will serve as the “water harvester.”

“The Club will be a highly environmentally sensitive large-scale resort development engineered for minimum adverse impact on the environment and maximum savings of water resources through water harvesting,” according to the documents.

It will be complete with amenities such as a club house, spa, sports center, aquatic sports center, equestrian center, organic gardens, vegetable gardens, fishing barge, biking trail, forest/nature trail and a camp site that will be operational by the end of 2012. The preferred shares to be sold by Abici will carry the right to nominate members of the club but they are without voting rights.

Portion of the the P782 million to be raised from the primary offering will be used for pre-operating expenses, including the costs of hiring, training and maintaining personnel during the pre-operating period. Likewise included are the costs of food tasting and dry runs of the restaurants as well as consultancy and other fees to be incurred prior to the launch.

Fresh funds are also budgeted for the following: working capital, real-property tax and club enhancement.

In the meantime, P4.1 billion of the proceeds from the secondary offering portion will be used to complete the construction of the clubhouse as well as the 150 luxury casitas divided into six-themed clusters. Thus, the bulk of the proceeds from the secondary offering will be used to pay for the loans contracted for the club construction while the balance will be used to cover interest, expenses for future renovation and equipment replacement and other asset acquisitions to improve the club.

The selling shareholder is Alphaland Balesin Island Resort whose parent Alphaland Corp. will advance P1.5 billion to jumpstart the resort development.

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