Filinvest raises $200M from foreign bond issue | Inquirer Business

Filinvest raises $200M from foreign bond issue

04:36 AM September 12, 2020

Gotianun-led conglomerate Filinvest Development Corp. (FDC) has returned to the offshore bond market after seven years, raising $200 million from the issuance of new IOUs at the lowest overseas coupon rate ever attained by the group.

The five-year senior unsecured fixed rate notes were priced to yield 4.125 percent annually—25 basis points tighter than the initial price guidance.

“We are pleased with the outcome of the successful issuance which confirms the confidence and strength of FDC’s name and track record in the Philippines. This bond issuance will further optimize our capital structure, as well as position us to pursue new investments in infrastructure and sustainable solutions such as solar energy, water and waste water,” FDC president and chief executive officer Josephine Gotianun-Yap said in a press statement on Friday.


“The tremendous market response to our bond offering is beyond what we expected after such a long absence. This overwhelming support only serves to validate FDC’s record of resiliency and financial discipline over the years,” said FDC chair Jonathan Gotianun.


The last time that FDC tapped the overseas bond market was in 2013, when it sold $300 million worth of seven-year IOUs an interest rate of 4.25 percent a year. These bonds were redeemed by the conglomerate last April.

FDC disclosed to the Philippine Stock Exchange on Friday that net proceeds from the new issuance would be used to finance capital expenditure in digitalization, water, desalination, waste water and renewable energy projects, the district cooling system joint venture, other infrastructure projects, and to refinance some maturing loans as well as for general corporate purposes.

“The issuance allows us to diversify our funding sources, partially refinance existing debt, and gives us flexibility in managing our maturity profile,” FDC chief financial officer Nelson Bona said.

UBS AG Singapore branch served as the sole global coordinator for the issuance while UBS AG Singapore branch and Standard Chartered Bank were the joint bookrunners.

China Bank Capital, Metropolitan Bank & Trust Co., Philippine National Bank Capital and Union Bank of the Philippines acted as the domestic lead managers for the transaction.

A number of Philippine companies have been taking advantage of record-low global interest rates—spurred by aggressive monetary easing by major central banks to counter the coronavirus pandemic—to lock in long-term funding.


FDC grew its first semester net profit by 24 percent year-on-year to P7.2 billion as its banking and sugar businesses made up for the slump in real estate development, hotel and power businesses caused by the COVID19-related lockdown protocols. For the second quarter alone, FDC’s net profit went up by 38.9 percent year-on-year to P4.21 billion. —DORIS DUMLAO-ABADILLA

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TAGS: Filinvest Development Corp., Josephine Gotianun-Yap, offshore bond market

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