The deal comes at a challenging time for brick-and-mortar retailers as shoppers increasing shift online, while home furnishing competition in the capital Manila, where most of AllHome's stores are located, is likely to intensify with the Philippine arrival next year of Sweden's IKEA AB [IKEA.UL].

AllHome will sell shares at 11.50 pesos ($0.22) each, versus guidance of 11.50 pesos to 14 pesos, the company said in a notice to the stock exchange, confirming a Reuters report earlier on Thursday.

AllHome's IPO could raise up to $285.35 million, the largest Philippine deal since the $380 million maiden share sale of Pilipinas Shell Petroleum Corp in October 2016.

The books for AllHome's IPO were multiple times covered at a higher price but the company opted for the lower price to increase the attractiveness of the stock when listed, said people with direct knowledge of the matter, who declined to be identified as they were not authorised to speak to the media.

The Philippine stock market is among Southeast Asia's top performers this year, up about 5.7%, though momentum has stalled somewhat in recent months.

Noel Reyes, chief investment officer of Security Bank Corp, said riskier assets such as shares are being weighed down by external factors, including the spreading impact of a Sino-U.S. trade war characterised by tit-for-tat import tariffs.

"For the IPO to fly, Allhome has to give additional potential returns," Reyes told Reuters.

The retailer is owned by Manuel Villar, a former presidential candidate and the Philippines' richest man, who also has interests in banking, gaming, real estate and utilities.

Philippine firms are increasingly tapping the capital markets this year compared with 2018 when there was just one IPO that raised about $150 million. AllHome is the third domestic IPO this year.

More Philippine companies are set to launch IPOs later this year. Early this month, the hospital unit of Metro Pacific Investments Corp filed for an IPO that could raise up to 83.33 billion pesos ($1.59 billion).

AllHome's final IPO price gives the firm a valuation of about $826 million.

New capital from the sale of up to 1.29 billion shares including an over-allotment option will fund store expansion and debt payments. AllHome currently operates 25 home improvement stores mostly in the capital Manila.

AllHomes tapped UBS as the sole global co-ordinator, and joint bookrunner with CLSA and Credit Suisse. China Bank Capital and PNB Capital are the local underwriters.

($1 = 52.14 Philippine pesos)

(Reporting by Neil Jerome Morales in Manila and Anshuman Daga in Singapore; Editing by Clarence Fernandez and Christopher Cushing)

By Neil Jerome Morales and Anshuman Daga