STI Holdings sets sale of P3B in IOUs

Private school chain operator STI Holdings is raising P3 billion from the issuance of debt notes to selected institutional investors.

In a recent disclosure to the Philippine Stock Exchange, STI said it had mandated China Banking Corp. to act as issue manager for the fund-raising. The bank will also be among the noteholders.

Compared to a retail bond offering, which requires a more tedious securities registration process, the issuance of corporate notes is a faster way to raise funds as these debt securities are sold to no more than 19 institutional investors.

STI chair Eusebio Tanco said the company was looking to issue corporate notes with maturities of five to seven years.

In the company’s disclosure, it said that the net proceeds from the issuance would be used for capital expenditures and other general corporate purposes.

For the nine-month period ending December 2013, net income attributable to equity holders of parent firm rose to P609.9 million or about 8.8-percent higher than the previous year’s level. The educational network boosted gross revenues by 13 percent year-on-year to P1.36 billion as its schools expanded enrollment base.

Schools operated by flagship unit STI Education Services Group (STI-ESG) and its subsidiaries increased student population from 68,363 in the comparative period the previous year to 71,195 by end-December. STI-ESG schools also had more students enrolling in four-year Commission on Higher Education (CHED)-approved courses than the two-year programs under Technical Education and Skills Development Authority (Tesda). Seventy-six percent of enrollees were in four-year programs and 24 percent in two-year programs, as compared to the 70-30 percent mix in 2012.

One iAcademy, a high-end technology school which serves as a training ground for globally competitive professionals, also contributed P91 million in revenues during the period. Doris C. Dumlao