SEC approves pioneering P1-B corporate debt fund
The Securities and Exchange Commission (SEC) approved the creation of a new investment product that would exclusively invest in debt securities such as bonds and corporate debt paper issued by companies operating in the Philippines.
In a statement on Monday, the SEC said ATRAM Unitized Corporate Debt Vehicle Inc. was authorized to act and operate as the country’s first-ever corporate debt fund.
The fund will be managed and principally distributed by ATR Asset Management Inc.
ATRAM Unitized Corporate Debt Vehicles’ initial offer would raise P1 billion, which will comprise one billion units of participation at P1 per unit, through a fund that will be called ATRAM Unitized Corporate Debt Fund 1, or ACDF-1.
“ACDF-1 shall be primarily offered to qualified buyers under private placements within six months from the commencement date, with a term of two years from the issue date and for a minimum initial investment of P1 million,” the SEC said.
The SEC said the debt fund would eventually offer 50 billion units, subject to remaining requirements.
A corporate debt vehicle offers a fixed number of units or securities to “any number of qualified buyers and/or non-qualified buyers not exceeding 19 persons in the Philippines during any 12-month period with the specific objective of investing in the corporate debts of large corporations and medium-sized enterprises.”
The fund will then invest in bonds, notes, commercial papers, debentures and other evidence of indebtedness, whether secured or unsecured, of large corporations and medium-sized enterprises operating or deriving income in the Philippines, the SEC said.
ATRAM Unitized Corporate Debt Vehicle is the first company to apply for a corporate debt vehicle offer under the SEC’s rules that were issued in 2020.
The new investment product is intended to support the liquidity needs of large and medium-sized corporations in the aftermath of the COVID-19 pandemic, the corporate regulator added.
