Converge to return to debt market

Dennis Anthony Uy —contributed photo

Fiber internet provider Converge ICT Solutions Inc. divulged potential plans to raise funds by tapping the remaining P10 billion in its bond shelf registration in the second half as it intends to further grow customer reach across the country.

Matthias Vukovich, chief financial office advisor at Converge, said in a briefing on Monday that the internet service provider was “well-covered into the second half of the year.” It is set to spend up to P28 billion this year for expansion initiatives.

“But we will probably raise additional debt in the latter half of the year,” he said, adding that this could be drawn from the bond shelf or bilateral credit lines with banks.

“We have very attractive terms on both ends.”

Just last month, Converge completed its P10-billion maiden bond issuance, which was eight times oversubscribed. The 5.59-percent debt offering will mature on April 8, 2027.

Proceeds will fund Converge’s projects, including network expansion of its fiber broadband services, especially in unserved and underserved areas of the country.

As for equity financing, Vukovich said there were no plans for that for now.

Converge chief operations officer Jesus Romero said the company continued to aggressively expand its network nationwide.

“[There] is still a lot of room to grow with Luzon. There’s a lot of areas our network has yet to reach,” he said.

In the northern region, Romero said the company was targeting Abra, Kalinga, Ifugao and Mountain Province next. It also seeks to establish presence in Negros Occidental and Leyte.

As of end-March, Converge’s network had reached over 12.2 million homes and more than 1.8 million residential subscribers. It deployed over 640,000 new fiber-to-the-home ports in the first quarter.

Converge saw its net income improve by 27 percent year-on-year to P1.97 billion in the first quarter as revenues from its residential and enterprise segments grew by 42 percent and 25 percent, respectively. Consolidated revenues were up 40 percent to P7.75 billion for the period.

“We are seeing a solid growth of our financials in the first quarter of 2022 and we expect to hit our full-year targets as we remain aggressive in our network rollout and marketing activities both in the residential and enterprise segments,” Converge CEO and co-founder Dennis Anthony Uy said. INQ