Alliance Global seeks changes in $500-M debt note contract

Alliance Global Group Inc. of tycoon Andrew Tan is seeking the consent of its creditors to amend the covenant governing the group’s $500-million Singapore-listed debt paper.

The proposed amendment, among others, will AGI to acquire “greater flexibility” in carrying out business strategies, “in light of expected expansion and investment opportunities in the Philippines in the near-term.”

AGI told the Philippine Stock Exchange that such amendments were also sought to make other necessary clarificatory modifications and generally align the financial covenants and related provisions “more closely to market standard forms.”

The $500-million notes, due in 2017, carry an annual interest rate of 6.5 percent.

The debt paper was issued by AGI Alliance Global Group Cayman Islands Inc. and guaranteed by AGI.

The notes are listed on the Singapore Exchange Securities Trading Limited (SGX-ST).

AGI has called for a meeting of noteholders to pass the proposal on March 22 at the offices of Allen & Overy at Three Exchange Square in Hong Kong.

UBS AG Hong Kong branch was mandated as the solicitation agent for this solicitation.

No other details were disclosed on the proposed terms.

An analyst said this move was reminiscent of San Miguel Brewery Inc.’s initiative in 2011 to amend the terms of its P38.8-billion bonds, citing the need to strengthen investor protection, align with global credit rating debt metrics, and make room for more efficient use of resources.  Doris C. Dumlao