After deferring its Initial Public Offering (IPO) plan slated last year, upstream oil exploration firm Frontier Oil Corp. (FOC) finally informed the Philippine Stock Exchange (PSE) last week that it is abandoning its planned listing in the local stock exchange.
Global stock exchange listing
A letter to the PSE dated June 22, 2014 stated that “Frontier is now focused on exploring an alternative listing possibility on another global stock exchange and, as such, wishes to withdraw its plans for a local offering.”
It is reported that the company is planning to list in the Toronto Venture Exchange instead, following a “substantial downturn in Philippines’ investor confidence that resulted from the tragic typhoon in late 2013.”
The P2.2 billion IPO was originally approved by the PSE in October 2013. The company planned to start the offer period during the 2nd week of November but decided to postpone it to year-end in the aftermath of supertyphoon Yolanda (Haiyan) that devastated parts of the Philippines in November 8, 2013.
Frontier Oil moved its offer period to November 28 to December 4 and the listing date to December 11.
However, lingering effects of typhoon Yolanda and impact of the tapering of the US Quantitative Easing program made the company decide to postpone the IPO again to 2014.
Frontier Oil planned to issue to the public 883.62 million common shares at an offer price of up to PHP 2.50 each, resulting in total proceeds of more than P2.21 billion.
Proceeds from the IPO would have been used for general working capital requirements and for the development of Service Contracts (SC) 50 and 52, which would have brought FOC’s 2 wholly-owned oil and gas exploration projects in Cagayan Valley and in Northwest Palawan to commercial production.