Aboitiz prepares to tap offshore bond market

Conglomerate Aboitiz Equity Ventures is preparing to tap the offshore bond market through an overseas unit this 2020 as the group seeks to fund expansion across various business units.

In a disclosure to the Philippine Stock Exchange on Friday, AEV said its wholly owned subsidiary AEV International Pte. Ltd. had appointed The Hongkong and Shanghai Banking Corporation Limited (HSBC) and Standard Chartered Bank as joint global coordinators.

BS Bank Ltd., HSBC, Mizuho Securities (Singapore) Pte. Ltd., MUFG Securities Asia (Singapore) Ltd. and Standard Chartered Bank were also mandated as joint lead managers and joint bookrunners.

These international institutions were mandated to arrange a series of fixed income investor meetings and conference calls in Hong Kong, Singapore, and London starting Jan. 6.

“An offering of US dollar-denominated Regulation S only senior unsecured notes may follow, subject to market conditions,” the disclosure said.

Regulation S securities refer to bonds or stocks that may not be offered, sold or delivered within the United States.

“The notes, if issued, are expected to be unconditionally and irrevocably guaranteed by AEV and unrated,” the disclosure said.

Local corporations are seen tapping more offshore bond deals this year due to large funding requirements driven by both government-led and private entities which may crowd out the local debt market.

For its part, the Aboitiz group expects a broad improvement in the performance of various businesses this new year, especially the flagship power business which was besieged by power plant outages that jacked up expenses last year.

The infrastructure business, for instance, is seen by AEV to be an exciting area given the number of unsolicited proposals submitted in the past two years and the indication that the government is now willing to sanction more public-private partnership projects.

For the real estate business, AboitizLand is upbeat on opportunities across the residential, commercial and industrial property segments.