SEC OKs Vista Land’s planned P20-B bond offering

The Securities and Exchange Commission has approved a plan by Villar group-led Vista Land & Lifescapes to raise as much as P20 billion from the domestic bond market to fund its expansion program in the next three years.

The initial tranche of the bond offering is sized at a maximum of P5 billion, consisting of P3 billion in base offer and P2 billion in over allotment, based on a document from the SEC.

The offering of up to P5 billion in bonds will be in tenors of seven and 10 years.

For the seven-year tenor, the interest rate is expected to be based on a spread of 125 to 160 basis points over the comparable local benchmark bond. For the 10-year tenor, the projected spread is between 140 and 175 basis points.

VLL has the option to redeem the bonds—in whole but not in part—before maturity date.

The bonds are intended for listing on local fixed income trading platform Philippine Dealing & Exchange Corp.

The SEC’s shelf registration mechanism allows issuers to register and sell under the same prospectus and other regulatory filing requirements a certain volume of securities that the company does not intend to use right away. In the event that the oversubscription option is not fully exercised, the unused portion will be made part of the remaining bonds in the shelf to be used within a three-year period.

In the first quarter of 2017, Vista Land reported an 11-percent year-on-year growth in net income to P2.3 billion. Consolidated revenue for the quarter ended at P9 billion, 14 percent higher than the previous year.

The company’s total consolidated assets as of end-March amounted to P180.6 billion.

Capital expenditures for 2017 are expected to reach P35.3 billion.

In addition to the expansion of rental portfolio, which provides stability to Vista Land’s existing core and stable end-user housing business, the company plans to continue to launch projects in new areas across the Philippines. It plans to expand its research to 100 new cities and municipalities.

To date, Vista Land has an established presence in 107 cities and municipalities across 44 provinces.

It intends to focus on the development of “communicities,” referring to integrated urban developments combining lifestyle retail, prime office space, university town, healthcare, themed residential developments and leisure components. —DORIS DUMLAO-ABADILLA