LOGISTICS company LBC Express Inc. plans to spend P1.5 billion this year on information technology (IT) and to put up additional branches in the country.
Santiago G. Araneta, the company’s chairman, said bulk of the spending would fund its ongoing IT projects.
“LBC likes to run on a pure variable basis. It’s the business that we’ve chosen,” Araneta said. “The only capital is the technology and we’re spending half of the P1.5 billion for that.”
Currently, the company has over 1,110 stores in the country and about 70 in the rest of the world. It aims to end the year with about 60 more stores around the Philippines.
“Most of the cargo we do today is inbound,” Araneta said. He added: “Moving forward, the firm intends to ‘cross board’ around” the Association of Southeast Asian Nations (Asean) integration.
Araneta said they plan to buy logistics companies in Southeast Asia in line with the Asean integration. He added that initiative would be financed by the company’s backdoor listing on the capital market this year.
“We’re taking an eye at some logistics companies in Indonesia, Malaysia and Thailand,” he said.
Araneta said his company is “attempting to raise about P7 billion” through the backdoor-listing route that it chose to enter into the stock exchange.
It recently bought 59.1 million unissued shares from Federal Resources Investment Group Inc. at P1 apiece. This initiative will result in LBC Express’s majority ownership of the listed shell company.
Federal has an authorized capital stock of 100 million at P1 par value, with 40.9 million shares issued and outstanding shares. At that rate, LBC Express will take in some 59 percent of the company if the deal pushes through.
LBC Express was originally eyeing to list on the local bourse via an initial public offering. But this initiative was stalled by the port congestion last year.
Going public via backdoor listing is much cheaper versus launching a public offering. Through this route, an unlisted firm may acquire shares from dormant or shell companies and proceed with the changing of the name and corporate purposes of the corporation.
Ten companies are expected to list on the stock exchange this year. The list includes Crown Asia Chemicals Corp., Company of Friends Inc., Gweilo Corp., Green Power Panay Philippines Inc., Global Ferronickel Holdings Inc. and National Book Store Inc.
LBC Express is a provider of courier and freight-forwarding services. It is also a nonbank provider of domestic-remittance services and inbound international remittance services in the Philippines.
It is also one of the top 5 nonbank providers of domestic remittance services by remittance volume, as well as one of the top 5 nonbank providers of international inbound remittances in the Philippines by remittance volume in calendar year 2012.