Melco raising P15 B from debt paper

MANILA—A local unit of Macau’s Melco Crown, the SM group’s partner in developing a $1.3-billion integrated entertainment and gambling complex called “City of Dreams Manila” at Pagcor Entertainment City is raising P15 billion through a private offering of debt notes to selected investors.

MCE Leisure (Philippines) Corp., a wholly owned subsidiary of locally listed Melco Crown (Philippines) Resorts Corp. (MCP), is issuing senior notes due in 2019 at 5 percent per annum to no more than 19 primary institutional lenders, according to a disclosure to the Philippine Stock Exchange on Friday.

The group intends to use the net proceeds from the offering for capital expenditure, refinancing of debt and general corporate purposes.

The issuance of the notes is expected to occur before January 31, 2014, subject to customary closing conditions.

The notes were offered via private placement to no more than 19 institutional lenders and are thereby exempted from the registration requirements of the Securities and Exchange Commission. The offering of corporate notes, as opposed to a retail offering of bonds, is thus an easier fund-raising route taken by big companies tapping the debt market.

Previously called the “Belle Grande” project prior to the entry of the Melco group, the Melco-SM consortium has upgraded capital spending on the gaming project to strengthen the bid to attract gaming patrons from mainland China, Hong Kong and Macau.