SM Prime’s P20-B bond offer gets top rating

Property giant SM Prime Holdings Inc.’s planned bond offer has received the top rating from debt watcher Philippine Rating Services Corp. (PhilRatings).

Philratings assigned a credit rating of PRS Aaa to SM Prime’s planned P20 billion offer, which includes a P5 billion oversubscription option.

This means the debt sale carriers minimal risk of default.

It said the planned bond issuance is the initial tranche of SM Prime’s P100 billion three-year shelf registration debt securities program, which was also given a PRS Aaa rating.

“The issue rating reflects SMPH’s strong brand equity; its solid track record across a well-diversified portfolio; its sound financial profile, supported by strong recurring income, and the company’s highly-experienced board and management,” Philratings noted.

SM Prime Holdings is part of the Sy family’s SM Investments Corp., one of the country’s largest conglomerates with interests in banking, retail and property.

SM Prime is also one of the country’s largest property firms. It runs the biggest shopping mall franchise in the country, with a gross floor area of 8.5 million square meters across 73 malls. It has seven malls in China with a gross floor area of 1.3 million.

SM Prime’s domestic and China malls cater to almost 4.5 million customers daily. Through SM Development Corp., SM Prime is a major housing developer, having launched 136,994 residential units since 2003.

It also operates office buildings, convention centers and hotels. As of September this year, the company had 1,748 hectares of land for future projects.
Philratings also cited the “strong presence” of the heirs of SM Group founder Henry Sy Sr. on the company’s direction, noting they are “seen to continue the successful growth strategy of the group, going forward.”