Megawide eyes return to capital market in Q3
Construction and infrastructure group Megawide Construction Corp. plans to return to the local capital market in the third quarter to raise P4 billion to refinance debt and other corporate spending.
Among its capital expenditures this year are outlays for the Carbon Market in Cebu, the Baguio terminal-oriented development, precast plant expansion for mass housing projects, expansion of the batching plant for the Malolos-Clark infrastructure project and other equipment for infrastructure, Edgar Saavedra, chair and chief executive officer of Megawide, said.
In line with a fresh capital build-up program, Megawide plans to offer for sale of up to 40 million preferred shares at a target price of P100 per share, by way of public offering or private placement transaction.
The company has applied for an increase in the authorized capital stock of its preferred shares by 26 million, which will bring total authorized preferred shares to 150 million. These preferred shares are cumulative, nonvoting, nonparticipating, nonconvertible and they have perpetual tenor.
Megawide said the increase in authorized capital was part of the company’s long-term financial management program which began in February last year, when it raised P3.6 billion from the issuance of corporate notes, proceeds from which were used to retire maturing obligations. This was followed by the issuance of P4.4 billion series 2 preferred shares last November.
“The success of these initiatives reflect the strong support and confidence of our financial partners in Megawide’s prospects and shareholder value-creation. We look forward to a more fruitful cooperation between sources and users of fund as we slowly build our country back toward a first world Philippines,” Edgar Saavedra, chair and chief executive officer of Megawide, said.
Article continues after this advertisement“Aside from resulting in a more manageable debt maturity tower, these exercises are very timely as we are able to take advantage of a low interest rate regime and generate savings from interest costs. Over the long-run, this will enable us to manage our liabilities more efficiently and strengthen our balance sheet altogether,” Ramon Diaz, Megawide’s chief financial officer, said.
