Aboitiz set to raise P25B via bond issue

Power and banking conglomerate Aboitiz Equity Ventures Inc. plans to sell as much as P25 billion in bonds in the latter half of 2015, with the fresh funds seen to support the company’s ambitions to expand its infrastructure portfolio.

In a stock exchange filing on Friday, Aboitiz Equity said its board approved the issuance of fixed-rate retail bonds. The bonds, the terms for which have yet to be finalized, can be issued in a single or in multiple tranches “in the second half of 2015.”

Aboitiz Equity said the proceeds of the bond issue would be used “to finance planned acquisitions, future investments and other general corporate requirements.”

The issue size would depend on the market conditions and the company’s needs.

In recent weeks, Aboitiz Equity has been announcing further expansion moves outside its core businesses, which include Aboitiz Power Corp., its main earnings contributor, and Union Bank. It is also engaged in property development via AboitizLand and food via Pilmico.

Last March 17, Aboitiz Equity sealed a contract with the Davao City Water District for a joint venture and bulk water purchase agreement. That paves the way for the supply of up to 300 million liters per day of treated bulk water to the city.

A larger potential deal is looming for Aboitiz Equity as it joined Ayala Corp., the Sy family’s SM Prime Holdings Inc. and tycoon Andrew Tan’s Megaworld Corp. in a P122.8-billion auction for the Laguna Lakeshore Expressway and Dike public private partnerships deal. The actual bid submission for that project is on July 6, 2015.