Phoenix, BDO ink P500-M debt note deal

Phoenix Petroleum Philippines Inc. on Wednesday executed a P500-million convertible notes facility agreement with BDO Unibank Inc., the oil firm announced Thursday.

The transaction includes a warrants offering of up to P180 million, the company said in a disclosure to the Philippine Stock Exchange.

This warrant will give BDO the option to buy P180 million worth of stocks after three years at a price to be agreed upon by both parties.

“The issuance of corporate notes is part of the company’s plan to raise long-term capital, finance expenditures and refinance short-term debt,” Phoenix Petroleum said.

The issuance of the warrants, however, will still be subject to the approval of the company’s shareholders, who will hold a special meeting sometime in September.

Phoenix Petroleum has embarked on its most aggressive retail network expansion program to date, involving the setting up of about 100 gas stations this year.

Under this program, the company has allocated P500 million to put up 40 gas stations in Luzon this year 20 in the Visayas and 40 more in Mindanao, in a bid “to formalize [its] claim to be the leading independent player in the oil industry.”

In five years’ time, Phoenix Petroleum hopes to have a total of 500 stations.

Phoenix is likewise planning to put up three more terminals in Iloilo, Bacolod and Cebu to support its growing retail network.