DoubleDragon secures P5.3B via bond issuance
Property developer DoubleDragon Properties Corp. has raised P5.3 billion from its c, boosting funds for projects that will generate recurring income.
In a disclosure to the Philippine Stock Exchange Friday, DoubleDragon said it would issue and list the 10-year retail bonds yielding 5.97 percent a year on Dec. 15.
“The company saw strong demand for the offer especially among retail investors, banks, pension funds, insurance companies and retirement funds,” it said in the disclosure.
“The substantial buildup of demand prompted DoubleDragon, through lead underwriters, to exercise an additional P300 million from the oversubscription option to accommodate the orders, which exceeded the initial offer of P5 billion,” it added.
This forms the first tranche of DoubleDragon’s P15-billion bond sale plan approved by the Securities and Exchange Commission under a three-year shelf registration program.
The shelf registration mechanism under the SEC allows an issuer to register and sell under the same prospectus and other regulatory filing requirements a certain volume of securities that the issuer does not intend to use right away.
The entire P15 billion is expected to complete the funding requirements of all of the company’s core projects in the pipeline in relation to its goal of building one million square meters of leasable space by 2020. By that year, DoubleDragon aims to post a profit of P4.8 billion.
The bulk of the proceeds will be used to finance the construction of projects that will generate recurring revenues for DoubleDragon: CityMalls, DD Meridian Park and Jollibee Tower.
The bonds were rated by credit watcher Philippine Rating Services Corp. “PRS Aa,” which considers the bonds as “high quality” and “subject to very low credit risk.” With this rating, the issuer’s capacity to meet financial commitment on the obligation is deemed “extremely strong.”
DoubleDragon intends to roll out a chain of 100 community malls under the brand “CityMalls” through 2020, mostly in the “underserved” markets of Visayas and Mindanao. The shopping mall business is under its flagship subsidiary CityMall Commercial Centers Inc. (CMCCI). SM Investments Corp. has a 34-percent stake in this company.
Previously known as Injap Land Corp., DoubleDragon was started by Edgar Sia II (of the Mang Inasal Chicken Bacolod restaurant chain) as a subsidiary of holding firm Injap Investments Inc. HoneyStar Holdings of Jollibee Foods founder and former CEO Tony Tan later bought into the company. —DORIS DUMLAO-ABADILLA
