SM Investments Corp. (SMIC) listed P15-billion fixed rate bonds at the Philippine Dealing and Exchange Corp. (PDEx) on Friday.
In a disclosure, the listed conglomerate said the retail bond offering, which was 3.7 times oversubscribed, was its biggest issue since 2016.
“We are pleased with the response to our bond issue. The hefty investor appetite for these securities was on the back of volatility around local interest rate sentiment with expectations of the US Federal Reserve hiking rates,” SMIC President and Chief Executive Officer Frederic C. DyBuncio said in a statement.
“This exercise mirrors investor confidence on SM’s credit quality and overall prospects for growth while increasing our funding flexibility and enhancing capital efficiency,” he added.
Interest rates for the second tranche Series I bond, 3-year retail bond stood at 3.5915% due on 2025, and Series J, 5-year retail bond at 4.7713% due on 2027.
This was part of the second tranche from the company’s P30-billion shelf-registered debt securities program.
Net proceeds from the bond issue will be used to refinance debt that funded capital expenditure.
BDO Capital & Investment Corp. and China Bank Capital Corp. were the joint issue managers, bookrunners and lead underwriters for the transaction.
“As the first corporate bond issuance of 2022, we are delighted to see how this offering was very well received by a broad range of investors. The strong demand reflects deep confidence in the SM group and is a sign of a more active market. China Bank Capital is proud to have helped SMIC execute this important transaction.” said Ryan Martin L. Tapia, president of China Bank.
