Lopez TV firm raises P6B from maiden bond offer

MANILA, Philippines—ABS-CBN Corp., the media holding company of the Lopez family, raised P6 billion from its maiden bond offering to partly finance a five-year expansion plan, a stock exchange filing showed on Wednesday.

The company said the bonds had a term of seven years at 5.335 percent a year. ABS-CBN had regulatory approval to sell as much as P10 billion and it might proceed to sell the remaining amount once the need arises, ABS-CBN treasurer Ricardo Tan Jr. said on Wednesday.

ABS-CBN said the first P6-billion tranche was met with strong demand from retail and institutional investors and the debt was priced at the low-end of an indicative range.

“The success of this bond issue is a major achievement for our company and is a culmination of management’s adoption and efficient execution of key business strategies over the last few years,” Aldrin Cerrado, chief financial officer of ABS-CBN, said in a statement.

ABS-CBN said the proceeds would be used mainly for investments amounting to about P10 billion over five years. The company, for example, said it would spend for the forward planning for its production process, which includes the construction of sound stages that will deliver improvements to operations by increasing production quality and reducing costs associated with on-location shoots.

The company will also use part of the proceeds for the rollout of digital terrestrial TV and the expansion of its pay-TV business through Sky Cable, the statement showed.

BDO Capital and Investment Corp., BPI Capital Corp. and HSBC acted as joint lead managers for the transaction. The company was earlier given the highest possible rating of PRS Aaa from Philippine Ratings Corp.

“The positive response we received from investors reinforces our view that ABS-CBN has earned a solid credit standing among the domestic investing community,” BDO Capital president Eduardo Francisco said in the same statement.

ABS-CBN, meanwhile, noted that it was on track for the Philippines’ switch to Digital terrestrial television as test broadcasts were being conducted in different parts of the nation.

It has also expanded its business into print, licensing, music, TV shopping and telecommunications.

Last year, the company started its TV shopping business, A CJ O Shopping, and its cellular telecommunications business, ABS-CBNmobile, which allows customers to view ABS-CBN’s content on smartphones in addition to data, SMS and voice products. ABS-CBNmobile uses the network infrastructure of Globe Telecom.

ABS-CBN said it expects to open its educational theme park, “Kidzania,” at the Fort Bonifacio Global City later this year.