Converge gets ‘tight’ pricing for P10-B bond offer

Converge Information and Communications Technology Solutions Inc. has set the interest rate for its P10-billion maiden bond offering at 5.59 percent.

In a disclosure on Tuesday, the telco firm said that its bonds “have been priced at 50bps (basis points) over Philippine 5-Year BVAL (Bloomberg Valuation Service) rates, at the tight end of the marketed 50-100 basis point range.”

The peso-denominated debt issuance, which is coming from the company’s P20-billion shelf-registration program, has a base tranche of P5 billion and an oversubscription option of up to P5 billion. Offer period is set on March 28 to April 1.

“We are pleased to be able to tap the bond market to help fund the expansion of our digital infrastructure as we further widen our reach nationwide,” Converge president and co-founder Grace Uy said.

BDO Capital & Investment Corp. is the issue manager of the transaction. BDO Capital and BPI Capital Corp. are the joint lead underwriters.

Proceeds of the transaction are earmarked for nationwide fiber network expansion.

This year, Converge is spending P26 billion to P28 billion, higher than the previous year’s P25.2 billion, in capital expenditures to deploy additional fiber ports.

Converge saw its net income grow by 111 percent to P7.2 billion last year from P3.4 billion in 2020 as it expanded its residential subscriber base and rolled out more fiber ports. The company said it deployed over 650,000 ports in the previous quarter, rolling out 2.4 million ports in total last year. INQ