(March 17): Top Philippine mobile wallet GCash could aim for at least US$8 billion (RM35.6 billion) in valuation when it goes public as soon as this year, its chairman said, as it urges regulators to ease rules to make way for its big listing.

“US$8 billion should be a minimum in my view,” Globe Telecom Inc president and CEO Ernest Cu said in an interview on Monday. Cu is also chairman of Globe unit Mynt, the parent of GCash.

Cu said bulk of the initial public offering will likely be secondary shares that would allow the exit of private equity investors which own around 10%-12% of the fintech, including Warburg Pincus and Bow Wave Capital Management. At a valuation of “US$8 billion and above” these investors will likely sell their shares, he added.

A potential IPO may take place by the end of 2025, and Cu said there’s no hurry to do it since GCash just did another funding round last year that boosted its valuation to US$5 billion. “It’s better to be done right than rushed,” he said.

The timing will partly hinge on the Philippine Stock Exchange and the Securities and Exchange Commission agreeing to lower the minimum public float to 10%-15% from the current 20%, the executive said.

If the IPO rules aren’t tweaked “to accommodate larger IPOs then you’ll remain a small IPO exchange,” Cu added.

The planned share sale comes as the local stock market is reeling from low liquidity and weak valuations, with only three IPOs last year — the same number in 2023 — half of the PSE’s goal. The market could see some big listings this year, with utility firm Maynilad Water Services Inc. filing for an IPO that could raise up to 49.1 billion pesos, the nation’s biggest so far.

GCash could top that. At US$8 billion valuation, the company must sell US$800 million to US$1.2 billion worth of shares to achieve a 10% to 15% public float.

“We were very open about requesting our exemptions from the 20% float requirement,” Cu said. But he acknowledged the plan also has a downside since a smaller public float may scuttle its hopes to be included in a regional index like the MSCI Asia Pacific Index.

“Without that, the foreign index funds may not participate in the stock, and that could affect valuation, that could affect liquidity. So all these play into our timeline,” the Globe Telecom CEO said.

Bloomberg News earlier reported that the IPO could potentially raise US$1 billion to US$1.5 billion, citing people familiar with the matter. The company was also said to have picked banks such as JPMorgan Chase & Co, Morgan Stanley and UBS Group AG to work on the share sale that could take place this year.

The Mynt chairman said he’s had discussions with “long-only” US, European and Japanese funds interested to become cornerstone investors for the IPO, Cu said in an interview with Bloomberg Television’s Annabelle Droulers and Rebecca Choong Wilkins earlier on Monday.

Japan’s Mitsubishi UFJ Financial Group Inc took an 8% stake in GCash during the last funding round in August. Apart from Globe, Jack Ma-backed Ant Group, and conglomerate Ayala Corp. are its key shareholders.

Helping build GCash, which has around 94 million registered users, to become the Philippines’ most popular mobile wallet would be one of the legacies of Cu, who’s set to step down in April as Globe’s chief executive, a position he has held since 2009. He will be replaced by former Airtel Nigeria CEO Carl Raymond Cruz, but Cu will remain chairman of Mynt.

Cu also pushed Globe to become the nation’s leading mobile service provider and the largest telco by market capitalisation. Retiring from leading Globe would allow him to travel more and play golf, he said. “Been there, done that. I don’t like watching the same movie twice.”

Uploaded by Magessan Varatharaja