Upson postpones maiden stock offering to Q1 2023

Upson International Corp., a retailer of computer products, on Wednesday said it has decided to defer its planned initial public offering (IPO) to the first quarter of 2023.

The company has already secured an approval for its IPO from the Securities and Exchange Commission and is set to conduct the offer next month, but Upson said the decision to postpone it to next year was aligned with the views of their underwriters, First Metro Investment Corp. and RCBC Capital Corp.

Operational updates covering nine months of the year, to include third quarter financials, would enable investors to better estimate a full-year performance, it said.

“We are encouraged by the interest and support we’ve received from the public with regard to our upcoming initial public offering. We remain committed to deliver on our growth and expansion plans. We continuously aim to be every Filipino’s partner of choice for their digital future,” Upson President and CEO Arlene T. Sy said.

Upson, which operate computer stores such as Octagon Computer Superstore, Micro Valley and Gadget King, was supposed to offer to the public up to 789.47 million common shares priced at up to P5.50 per share. The offer will also include 98.68 million in common shares to be issued by a selling shareholder at up to P5.50 per share, with another 98.68 million common shares as overallotment option.

Net proceeds from the offer could reach up to P4.15 billion, which Upson earlier said it will use for store network expansion and general corporate purposes. It can raise up to P5.43 billion, assuming the overallotment option is fully exercised.

Upson plans to use the proceeds for the expansion of its store network and to open 250 branches or an additional retail space of 25,000 square meters from 2022 to 2026. It will prioritize areas with the highest return potential and those where tech products are not readily available.

The company will not receive any proceeds from the sale of the secondary shares by the selling shareholder.

Upson had originally intended to conduct its offer from September 5 to 9, and to list on the Philippine Stock Exchange on September 16.

“The retail business has foot traffic as a fundamental growth driver. Yet, despite the pandemic years of 2020 to 2021, Upson’s revenue growth was driven by its market’s adaptation to online education and work-from-home. The ‘return to normal’ for the rest of the year gives us confidence that the pre-pandemic sales growths will continue to define the opportunities at hand,” Sy said.

The company’s updated prospectus following the adjusted timetable for the IPO will highlight its market performance for the third quarter of 2022. In August, Upson was able to reach a new milestone by opening its 200th store, from its initial 183 stores by the end of December 2021.

The company said it still aims to open 250 stores or an additional retail space of 25,000 square meters from 2022 to 2026, with an aggressive rollout in the next three years.