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Aboitiz plans to issue more bonds in next 2 years

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By Arra B. Francia, Senior Reporter

ABOITIZ Equity Ventures, Inc. (AEV) plans to issue more bonds once it locks in acquisition prospects in the next two years, following the completion of its P5-billion fixed rate bond offering yesterday.

AEV Chief Finance Officer Manuel R. Lozano said they may conduct another bond offering “sooner than later,” depending on the growth opportunities they see for the conglomerate’s various subsidiaries.

“We don’t have a specific plan yet. We believe there are a lot of growth opportunities that will require us to use the full shelf of P30 billion,” Mr. Lozano told reporters during the listing of AEV’s P5-billion bonds at the Philippine Dealing and Exchange Corp. on Tuesday.

Mr. Lozano said they see potential for food and agribusiness unit, Pilmico Foods Corp. after it recently acquired Singapore-based agribusiness firm Gold Coin Management Holdings Ltd. He also cited the expansion of the infrastructure and property development businesses.

“We have a lot of infra projects and even Aboitiz Land is also growing. We will be discussing soon when the next tranche will be. We have P25 billion to go, but we still have a couple of years,” Mr. Lozano said.




The top AEV executive added that they intend to fully exhaust the shelf registration.

“What’s nice about the bond is it gives us a very attractive option and then choose which one fits the opportunity as best as possible, that’s why the shelf gives us a lot of flexibility. When we feel the markets are there, then it gives us a quick opportunity to raise more,” Mr. Lozano explained.

The listed company on Tuesday raised P5 billion from the issuance of Series A bonds with an annual interest rate of 6.0157% due on 2024, as well as Series B bonds due 2029 with a coupon rate of 6.3210% per annum.

The capital raised will be used to partially refinance wholly owned subsidiary AEV International Pte. Ltd.’s medium-term loans.

AEV engaged BDO Capital & Investment Corp. and First Metro Investments Corp. to arrange the offering.

The bonds form part of the company’s P30-billion debt securities program registered with the Securities and Exchange Commission (SEC).

AEV saw its net income attributable to the parent drop by 27% in the first quarter of 2019 to P3.52 billion, weighed down by the weak operations of its power unit. This came amid a 27% uptick in gross revenues to P47.4 billion.

The company earlier said it will spend P81 billion in capital expenditures this year, bulk of which would fund the expansion of its power generation unit.

Shares in AEV jumped 1.76% or 95 centavos to close at P55 each at the stock exchange on Tuesday.