Phoenix raises $2B from debt issue
MANILA, Philippines–Phoenix Petroleum Philippines, Inc., the country’s leading independent oil company, has completed a $2-billion issuance of short-term commercial papers to bankroll expansion plans.
In a disclosure to the Philippine Stock Exchange, Phoenix Petroleum announced the close of the public offering of STCPs, which the oil firm said was “over-subscribed by almost two times.”
The STCPs were offered to investors through AB Capital & Investment Corporation (ABCapital) and Multinational Investment Bancorporation (MIB).
The STCPs were offered from Oct. 14 to 17 and will be issued on Oct. 24.
The instruments will be listed at the Philippine Dealing & Exchange Corp. (PDEx).
PDEx was quoted in a statement as saying that it was “looking forward to listing the first short-term commercial paper.”
PDEx said the STCP Program was meant to expand the list of tradable asset classes to cater to issuers of short-term debt.
“Listing STCPs alongside bonds in the organized market will afford corporate issuers the flexibility to access short or long-term funding supported by the same established secondary market infrastructure. For investors, the program shall also provide price transparency and liquidity for these instruments as alternative fixed-income investment options,” PDEx said.
Last May 8, ]the Philippine Rating Services Corp. (PhilRatings) assigned a credit rating of PRS 2 (minus) on Phoenix Petroleum’s proposed short-term commercial papers.
Obligations rated PRS 2 exhibit above average or strong capability for payment of both interest and principal. The local debt watcher said this rating was similar to that of a PRS 1 rating.
“Earning trends and coverage ratios, while sound, will be more subject to variations. Capitalization characteristics, while still appropriate, may be more affected by external conditions. Ample alternate liquidity is also maintained by the company. A plus or a minus sign can be added to further qualify an assigned rating,” PhilRatings explained.
The ratings firm said that, in assigning the grade, it took into account Phoenix Petroleum’s aggressive network expansion resulting in market leadership in the independent players sector, consistently improving revenue base and adequate liquidity and financial flexibility, and its competent and experienced management team.
Phoenix Petroleum is the country’s fourth largest fuel retailer with a strong presence in Mindanao.
It has more than 350 outlets, mostly down south.
The company aims to put up 500 additional pump stations over the next five years.
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