Fruitas Holdings Inc., the operator of food and beverage kiosks, on Monday said it has re-allocated part of the proceeds of its initial public offering (IPO) for the acquisition of the site of its coconut water commissary and its new headquarters.
In its disclosure, the company said it will re-allocate some P165 million for asset acquisition out of the P470 million it has previously budgeted for store network expansion and store improvement.
Out of the said amount, P145 million has been allocated to the acquisition of the site of its new headquarters, measuring more than 900 square meters with a 5-storey building and net floor area of more than 2,000 square meters, located in Sta. Mesa, Manila.
The company then will spend an additional P20 million for commissary expansion to cover the acquisition of the 1,328 square meter site of the coconut water commissary in Quezon City, which is currently being leased.
Total allocation for commissary expansion increased to P60 million from the previous P40 million.
“Fruitas noted that the objective of these property acquisitions is to secure ownership, and therefore the long-term use, of assets which are vital for the future operations of the group. Given the current low-yield environment, Fruitas is also investing its excess liquidity in assets which can provide higher returns, including potential capital appreciation in the long run,” the company said.
“The move will result in savings on lease expenses for the buko water commissary. Certain back-office operations will also be consolidated in the new headquarters and rental income will be generated from tenants of potential excess space,” it added.
Fruitas said it continues to re-open more stores as quarantine measures ease. The number of stores in operation has exceeded 600, the highest since the imposition of various levels of quarantine across the country.
The company’s board also approved the subscription to 40,000 common shares of Fruitas Group Inc. (FGI) at P400 per share.
FGI is a wholly owned subsidiary of FHI.
The subscription price was based on the book value of P371 per share as of December 31, 2019 with a minimal premium.
“The capital infusion into FGI is in line with the approved re-allocation of initial public offering proceeds last May 30, 2020,” the company said.