SEC thrills capital market with 3 big offers

The Securities and Exchange Commission (SEC) has approved a P30-billion debt sale plan by property developer Megaworld Corp., a P5-billion bond offer by school operator STI Holdings and a P1.24-billion stock market debut by Bermaz Auto Philippines Inc.

In the case of Megaworld, the first tranche of the offering is worth up to P12 billion of fixed-rate bonds due in 2024. The base offer is worth P8 billion, but there is leeway to upsize the offering, according to SEC documents.

Proceeds will be used for the following projects: Iloilo Business Park, McKinley Hill, McKinley West and Uptown Bonifacio.

BDO Capital & Investment Corp. was named issue manager, lead underwriter and bookrunner.

The borrowing program will use the shelf registration window of the SEC, which allows issuers to register and sell under the same prospectus and other regulatory filing requirements a certain volume of securities that the company does not intend to use up right away. In the event that the oversubscription option is not fully exercised, the unused portion will be made part of the remaining bonds on the shelf to be used within a three-year period.

Megaworld’s bond offer has obtained a triple-A rating from local credit watcher Philippine Rating Services Corp. (Philratings).

The SEC also approved STI’s P5-billion bond offering under the shelf registration. The first tranche will consist of P3 billion worth of seven- and 10-year bonds. STI’s bond offering obtained a double-A credit rating from Philratings.

Proceeds will be used by STI for building in greenfield areas, expanding capacity in existing sites and buying schools. This year alone, STI will break ground for seven or eight new campuses.

The SEC also gave Bermaz Auto Philippines Inc., an affiliate of Malaysian conglomerate Berjaya, the go-signal to launch a P1.24-billion initial public offering.

Bermaz plans to sell 155 million in primary and secondary common shares at a maximum price of P8 per share.

The Mazda car dealer has mandated MayBank ATR Kim Eng as its international and domestic lead manager and underwriter. Abacus Capital & Investment Corp. will act as co-underwriter.

Of the total offering, 83.43 million will consist of new common shares while 71.57 million will consist of secondary shares.

The deal will bring around 15.6 percent of Bermaz’ shares to public hands. A total of 993.56 million will be outstanding after the offer, giving the company a market capitalization of P7.95 billion if the maximum price is achieved.

About P400 million or bulk of the net proceeds from the primary offering will be used to construct a warehouse, body repair and paint facility. The company will also allot some of the proceeds to establish a Mazda training facility for automotive repair and motor services and to construct showrooms and satellite outlets.

The company has a policy of distributing up to 40 percent of the prior year’s net income as dividends, subject to the provision of funds for business plans, operating expenses and other expansion projects.