SEC approves SM’s P15B retail bond offer

Photo from SM City North Edsa website

MANILA, Philippines–The Securities and Exchange Commission has approved a plan by the country’s largest conglomerate SM Investments Corp. to raise as much as P15 billion from a fresh retail bond offering.
Based on its regulatory filing, SMIC was allowed to register seven- and 10-year fixed rate bonds with a principal amount of P10 billion with an oversubscription of up to P5 billion. The bonds will be sold through a public offering, which will begin on April 30 and end on May 12 this year. Issuance of the bonds is targeted on May 19.
The SMIC bonds will be issued in scripless form in minimum denominations of P20,000 each and in multiples of P10,000 thereafter.
Interest rate on the seven-year bonds is seen at a range of 4.7405-5.8405 per annum and on the 10-year bonds at 5.4114-6.4114 per annum.
The bonds are intended to be listed on the local fixed income trading platform Philippine Dealing & Exchange Corp.
In its regulatory filing, SMIC said it would use proceeds from the offering primarily to refinance existing debt obligations as well as finance expansion projects, particularly for SM Arena and the Asinan project in Parañaque City.
On the SM Arena project, SMIC plans to use part of the proceeds for retention payments due to suppliers and contractors of the completed 67,536-square meter commercial building.
The Asinan project, on the other hand, involves the construction of a 25,000-sqm warehouse building on the property.
BDO Capital, BPI Capital, China Bank and First Metro Investment Corp. have agreed to act as underwriters for the offering.