ALI plans P10-B bond offering

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AYALA LAND, Inc. (ALI) plans to raise P10 billion from the issuance of fixed-rate bonds by November, as the company completes its funding requirements for the year.

ALI Chief Finance Officer Augusto Cesar D. Bengzon said the bonds will be split into two-year and 7.25-year tenors due 2021 and due 2027, respectively. This is to accommodate the demand for shorter-term issuances.

“It’s going to be unique. It’s a dual tenored issuance… We’ll have the flexibility to determine how much will go to the two-year tranche and the 7.25-year tranche,” Mr. Bengzon told reporters after listing ceremony for ALI’s P3-billion bond offering at the Philippine Dealing and Exchange Corp. (PDEX) yesterday.

Mr. Bengzon said they have yet to decide on how the split will be between the two- and 7.25-year bonds, adding that this will be announced once they get closer to the offer period.

BPI Capital Corp. has been hired as the offering’s issue manager, and will act as joint lead underwriters and joint bookrunners alongside BDO Capital & Investment Corp. and China Bank Capital Corp., according to an offer supplement posted on ALI’s website.

The bonds are scheduled to be offered to the public from Oct. 21 to 31, with target listing at the PDEX on Nov. 8.

Proceeds from the offering — expected to reach P9.87 billion — will be used to partially fund the development of One Ayala Avenue-Makati, which will house retail, office, and hotel components. It will also feature a transport hub set to be completed in 2021.

It will also finance refurbishments of the Glorietta and Greenbelt malls in Makati, the development of Vermosa Mall in Cavite, the expansion of Seda Nuvali, as well as land acquisitions in Laguna and Batangas.

The funds are expected to be fully utilized by the first quarter of 2020.

Mr. Bengzon said this will be the company’s last issuance for the year, following its P3-billion bond offering listed at the PDEX on Monday and an P8-billion issuance last May. These form part of the company’s P50-billion shelf registration program with the Securities and Exchange Commission.

“It’s very efficient, this shelf registration. There was a time many years back when we’d have to figure out if we need to pre-fund, because the time to get the second and third issue is relatively long. Now we can do it in a three- to four-week period,” Mr. Bengzon said.

Aside from bonds, ALI is also considering bilateral loans to fund its P130-billion capital expenditure for 2019.

ALI generated a 12% increase in net income to P15.2 billion in the first half of 2019, following a four percent increase in revenues to P83.2 billion.

Shares in ALI rose 0.30% or 15 centavos to close at P49.45 each at the stock exchange on Monday. — Arra B. Francia