The country’s largest conglomerate, SM Investments Corp. (SMIC), has filed a registration statement to raise as much as P15 billion from the offering of long-term peso-denominated bonds by February next year.
These fixed-rate bonds will form the second tranche of its P30-billion debt securities shelf registration with the Securities and Exchange Commission (SEC).
P10-B base offer
Based on the SEC filing, these debt securities will be divided into two series, one of which will be due in 2025 and another in 2027. The bonds will be listed on the Philippine Dealing & Exchange Corp.
The base offer size is P10 billion but SMIC reserves the option to borrow an additional P5 billion from the market in case of overwhelming demand.
Net proceeds will be used to refinance its existing debt obligations and for general corporate purposes.
The bonds will be issued in scripless form in minimum denominations of P20,000 each, and in multiples of P10,000 thereafter, and traded in denominations of P10,000 in the secondary market.
SMIC has mandated affiliate investment houses BDO Capital & Investment Corp. and Chinabank Capital as joint issue managers, bookrunners and lead underwriters for this offering.
BPI Capital, Eastwest, First Metro Investment Corp., RCBC Capital Corp. and SB Capital were also tapped as joint bookrunners and lead underwriters.
The bonds are rated “PRS Aaa,” the highest rating given by local debt watchdog Philippine Rating Services Corp., with a “stable” outlook.
‘Stable’ outlook
Obligations rated “PRS Aaa” are deemed to be “of the highest quality with minimal credit risk.” The obligor’s capacity to meet its financial commitment on the obligation is considered to be “extremely strong.”
A stable outlook, on the other hand, indicates that the rating is likely to be maintained or to remain unchanged in the next 12 months.
SMIC is currently valued by the stock market at P1.17 trillion, making it the most valuable Philippine company to date. It is the dominant player in local retailing, banking and property businesses.