Ayala raises $400M through offshore perpetual bonds

The country’s oldest business house Ayala Corp. has raised $400 million from a new offering of offshore perpetual bonds that fetched the cheapest ever fixed-for-life interest rate out of Southeast Asia.

The bonds carried a fixed-for-life coupon rate of 4.85 percent per annum, the lowest-yielding fixed-for-life perpetual securities carved out of the region, Ayala disclosed to the Philippine Stock Exchange on Thursday.

The bonds will be issued by Ayala’s wholly-owned subsidiary AYC Finance Ltd. and will be unconditionally and irrevocably guaranteed by the parent conglomerate Ayala.

The offering was oversubscribed by four times the base offer, allowing Ayala to price the bonds 27.5 basis points lower than the initial price guidance.

A fixed-for-life perpetual issuance means the rate never changes.

“We are very pleased with the strong investor receptivity and continued support,” said Ayala chair and chief executive officer Jaime Augusto Zobel de Ayala.

“We are grateful for the unwavering support from the investors despite volatile market conditions. This issuance will provide us with additional flexibility to lengthen our maturity profile and support our strategic initiatives,” said Ayala chief financial officer Jose Teodoro Limcaoco./TSB