DNL IPO: Final initial public offering in 2012

James Ryan Jonas

In what is regarded as the final initial public offering (IPO) of the year, colorants, chemicals, and additives maker D&L Industries will issue to the public 1.071 million common shares, to be completed before the end of the year.

Each share is priced at P4.30 and the company expects to receive up to P4.6 billion from the said offering.

The D&L stock will start trading on December 12. The stock code will be DNL.

Company Background

D&L Industries is a family-owned enterprise that started operations in 1963 and incorporated in 1971. It is involved in the manufacturing and distribution of colorants, chemicals and additives used by companies in the plastics, paint, and ink industries. It is owned and controlled by the Lao family.

D&L Industries is a holding firm managing five affiliates and subsidiaries.

It fully owns Oleo-Fats Inc., a company manufacturing specialty food ingredients and specialty fats and oils.

It is also the owner of First in Colours (FiC) Inc., manufacturer of dry colors, masterbatches, color compounds, plastic additives and engineered polymers.

Aero-Pack Inc., also a wholly-owned subsidiary of D&L Industries, customizes aerosol products for home care, personal care, and maintenance chemicals.

It also owns D&L Polymer and Colours, Inc., a manufacturer of compounds for wire harnesses, masterbatches, color compounds, and engineered polymers.

Financial Highlights

In 2011, the company booked revenues of P12.8 billion, a 29% increase from the previous year’s revenues. Its net income in 2011 was P997 million.

Eighty-percent (80%) of D&L’s revenues are contributed by Oleo-Fats Inc. which supplies specialty fats and oil to local companies such as Jollibee Foods Corp., Monde Nissin Corp., San Miguel Corp., Unilever Philippines, Pfizer, Golden Arches (McDonald’s) and Krispy Creme.

First in Colours (FiC) Inc. supplies 18% of the company’s total revenues, while the rest are contributed by the other subsidiaries.

Offer Terms

According to the company, proceeds of the IPO will be used for acquisitions and capital investment, payment of financial obligations, and general corporate purposes.

The offer period will run from November 28 until December 6.

Interested investors may purchase D&L shares prior to the first trading day through their brokers.

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James Ryan Jonas teaches business management, investments, and entrepreneurship at the University of the Philippines (UP). He is also the Executive Director of UP Provident Fund Inc., managing and investing P3.2 Billion ($56.4 Million) worth of retirement funds on behalf of thousands of UP employees.