ISOC Cold Chain Logistics Inc., led by the Kosikyen family, has filed for a P1.49 billion Initial Public Offering (IPO), the proceeds of which will be used to expand its operations.
In a registration application filed with the Securities and Exchange Commission, the company using the Orca Cold Chain Solutions brand will offer up to 1.48 billion shares of common stock. They consist of 1.03 billion primary shares, 444.88 million secondary shares and an option to issue additional 222 million secondary shares, all with a par value of 0.10 pesos per share. He posted a target price of P0.88 per share on his offer.
It will trade under the ticker “ORCA” and will be listed on the small, medium and emerging markets of the Philippine Stock Exchange.
The Investment and Capital Corporation of the Philippines was selected as the sole manager of the transaction.
Orca was registered in October 2017 and uses the latest technology and technological innovation in the cold room industry.
He developed the first cold storage facility to feature a fully automated storage and retrieval system and is one of the few cold chain suppliers using this technology.
The company has two operating subsidiaries with a total capacity of 34,342 pallet spaces, equivalent to over 34.3 million kilograms. This is Arendelle Cold Logistics Inc. based in Brgy. Bagumbayan, Taguig and Eisberg Cold Logistics Inc. located in Brgy. Poblacion, Caloocan.
Orca is 60 percent owned by Isoc Holdings Inc., a company led by Michael Kosiken, co-founder of Megawide Construction Corp. The remaining 40 percent is owned by Philware Magnate Inc., which is headed by Yarik K. Kosikien, Michael’s younger brother.
Following the offer, Isoc’s stake will drop to 46.2% and Philware’s stake to 30.8%. Its public turnover will be 23 percent.
The company expects to increase gross revenue to 910.97 million pesos, while net revenue is estimated to reach 841.1 million pesos after deducting fees and other expenses.
The company said the amount will be used to expand existing facilities to accommodate other value-added services (VAS); development of new refrigerated warehouses, new business initiatives; and total working capital.
Orca will allocate about 150 million pesos to expand its Taguig facility, including the blast chiller and processing area.
“The company believes this will drive VAS revenue growth as well as increase the utilization of existing cold storage space. By expanding the existing Taguig Facility, the company is able to maximize existing demand in the area.
It will also allocate about 115.2 million pesos to build a new cold storage facility in Cagayan de Oro, its first facility in Mindanao.
The facility will have a capacity of 8,450 pallet spaces and the proceeds will be used to partially fund construction and equipment needed inside the facility.
About 167.7 million pesos will be used to build another new cold storage facility in Cebu province. The facility will have a capacity of 10,000 pallet spaces and the proceeds will be used to partially fund construction and equipment needed inside the facility. This will be Orca’s first facility in the Visayas region.
Orca intends to allocate 108.2 million pesos to its new business initiatives, such as expanding the business segment serving the firm’s pharmaceutical clients.
This includes the acquisition of necessary equipment for the Caloocan facility and future expansion sites. He said he would also need to expand teams in the field and upskill existing workers.
“This should allow Orca to service pharmaceutical products other than the Covid-19 vaccine at additional locations.”