The Securities and Exchange Commission of Cambodia has given the Phnom Penh Autonomous Port preliminary approval to make an initial public offering (IPO) on the country’s fledgling bourse, which the state-run firm expects to join in early December.
Should it succeed, the port will be only the third firm to list on the stock exchange, which launched 3 1/2 years ago.
The exchange commission’s approval, which came on October 7, means the company can start a book-building exercise to determine the exact number of shares to put on the market, and the initial price.
“After it reviewed relevant documents, comments and official reports, the meeting resolved to permit in principle the request for a public offering of equity by the Phnom Penh Autonomous Port,” a statement from the commission said.
Port chairman Hei Bavy said the book building would take place between October 19 and 22 and set a price for approximately 4.2 million shares somewhere between $1.08 and $1.55 each. That would place the total valuation of the IPO between $4.5 million and $6.2 million.
Mr. Bavy said regular investors would get to bid on 55 percent of that. Another 35 percent would be reserved for “strategic partner” companies that do business with the port, he said, while the remaining 10 percent would go to employees.
“The shares will be sold to our employees so that they can participate in working with us, to motivate them, and so that they can profit from their investments,” he said.
The chairman said all investors would also be guaranteed a 5 percent dividend and that firm would use the revenue from the IPO strictly to expand its core business operations.
“The government has already decided that the funds from the IPO will be reinvested into business expansion, like infrastructure, not to pay down debt or for other purposes,” he said.
Kong Channy, a port official tasked with preparing the IPO, said the shares would hit the stock exchange on December 11.
In preparation, he said, the port was setting up separate accounts where the shares could be paid for in advance, one for employees at the Foreign Trade Bank of Cambodia and another for the port’s customers at Acleda Bank. He said they will have to buy the number of shares they want for $1.55 each and will be refunded the difference if the price per share ends up being lower.
Mr. Channy said that potential investors would have a chance to put questions about the IPO to port officials at a meeting on Monday.
If and when the port does join the bourse, it will be listed alongside the state-run Phnom Penh Water Authority and sportswear manufacturer Grand Twins International. Both stocks have underperformed since listing.