AYALA Land, Inc. (ALI) is issuing up to P10-billion fixed rate bonds to generate financing that will support its capital expenditure (capex) requirements.
The listed property developer filed its offer supplement with the Securities and Exchange Commission (SEC) on June 2 to issue the fourth tranche of its P50-billion shelf registration. A copy of the filing was given to the media over the weekend.
The planned offer will have a principal amount of up to P6 billion and an oversubscription option of up to P4 billion. The bonds are intended to be listed in the Philippine Dealing & Exchange Corp.
It had tapped BDO Capital and Investment Corp., BPI Capital Corp. and China Bank Capital Corp. as joint lead underwriters and bookrunners for the offer.
Should it exercise the oversubscription option, ALI expects to net some P9.87 billion from the issuance. If not, the net proceeds will be approximately P5.92 billion. This will be used to partially finance the company’s general corporate requirements, including capex.
Specifically, ALI intends to allot the proceeds for its Ayala Triangle Garden 2 project in Makati City; Central Bloc — Cebu I.T. Park in Cebu City; land acquisitions in Pampanga and Bonifacio Global City; and investments for its Parklinks project with Eton Properties.
Other projects it will finance are the One Ayala Avenue in Makati City; Vermosa Mall in Cavite; retail, outsourcing and hotel projects in Manila Bay; and land acquisitions in Pampanga, Laguna, Cavite and Bulacan.
“Costs related to the projects, in general, include various construction-related materials and services… The net proceeds from the offer, which are expected to be fully utilized in 2020, will be disbursed accordingly,” it said in its offer supplement.
The SEC said ALI had so far issued three tranches worth P21 billion from its P50-billion shelf registration.
The company announced in April it was spending P69.8 billion for capex this year, about 37% lower from its previous plan as a reaction to the coronavirus disease 2019 (COVID-19) pandemic.
Aside from the P10-billion bonds, ALI’s board of directors also approved in May a plan to offer P19-billion bonds to refinance its outstanding debt.
ALI’s earnings were down 41% to P4.3 billion in the first quarter because of a slowdown in bookings and project completions, which were affected by the Taal Volcano eruption and the lockdown measures for COVID-19.
Shares in ALI at the stock exchange closed P38 each on Friday, up 50 centavos or 1.33% the earlier day. — Denise A. Valdez