April 26, 2018, 7:26 pm
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Logistics firm seals $220M loan

Chelsea Logistics Corp. (CLC), the logistics unit of Udenna Corp., yesterday formally signed a $220-million bridge loan with Bank of China as part of the company’s plan to grow its business in the country.

Chelsea said part of the proceeds from the loan would be used to finance the acquisition of a substantial interest in  2GO Group Inc.

The company said  it will to continue to focus on the shipping segment of the logistics business as it taps into the prospects of the industry.

“With a lot of islands, we really need to move from one place to another,” said Dennis Uy, Chelsea Logistics chairman. 

Uy is also the president and chief executive officer of Phoenix Petroleum.

Uy said the industry’s growth is anchored by the strong fundamentals of the economy that has been posting consistent growth in the past several years. 

 Uy also  disclosed  plans to rightsize and modernize the company’s fleet of ships, especially after it has acquired a stake in listed firm 2Go.

In March, Chelsea Logistics acquired the outstanding capital stock of Udenna Investments B.V. (UIBV) which late last year bought into KGLI-NM Holdings Inc., which in turn has direct ownership of Negros Navigation Co., Inc. -- the controlling shareholder in 2GO.

The loan sealed by Chelsea with China’s state bank is part of the latter’s $3 billion commitment to the Philippine government.

Uy said the company is committed to “further the development of the shipping of logistics industry and to contribute the component of infrastructure development in the Philippines.” 

“These are the key components to boost the foreign and domestic trade,” he said.

“Our aspiration is for all kinds of shipping to serve the archipelago or islands of the country; banker vessels, tankers, Ro-Ro (roll on, roll off)  and to complement  logistics up to manufacturing, to the consumers,’’ Uy said.

Chelsea Logistics is currently in the middle of an P8-billion fund raising activity through the capital market. 

The company is looking to issue 546.59 million common shares, 30 percent of its shares post-offer, at a maximum price of P14.63 apiece. 

“The company has moved toward launching an initial public offering to accelerate its expansion while the Philippine economy continues to progress,” the company said in a statement.

Chelsea said it expects to net P7.59 billion from the offer, the proceeds of which will be used to expand its cargo and passenger shipping businesses.

BDO Capital & Investment Corp., serves as issue manger, lead underwriter and sole bookrunner.
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