PETRON Corp. has greenlit the issuance of dollar-denominated senior capital securities in $200,000 denominations, the proceeds of which will be used for the company’s debt payments and general corporate purposes, the listed oil company said on Thursday.
Petron told the local bourse that its board of directors had authorized the company to issue the perpetual capital securities “under terms and conditions as the management may determine.”
According to a preliminary offering circular, Petron said that “the securities will be issued in registered form in denominations of $200,000 and integral multiples of $1,000 in excess thereof.”
The firm did not give further details on the initial rate of distribution or the issue price. It mentioned, however, that the expected closing date is 2021, and that the increase in the rate of distribution is 2.5% per annum.
Since the securities are perpetual, they do not have a fixed redemption date.
“The issuer may redeem the securities (in whole but not in part) on the step up date or any distribution payment date falling after the step-up date,” Petron said.
The Ramon S. Ang-led firm said that the securities are being offered only outside of the US in offshore transactions in line with the amended US Securities Act of 1922.
“The securities being offered or sold herein have not been, and will not be, registered with the Philippine Securities and Exchange Commission under the Philippines Securities Regulation Code,” Petron clarified.
The firm explained an “approval in-principle” was already obtained from the SGX-ST (Singapore Exchange Securities Trading Ltd.) to list and quote the securities.
“For so long as the Securities are listed on the SGX-ST and the rules of the SGX-ST so require, the Issuer shall appoint and maintain a paying agent in Singapore, where the Securities may be presented or surrendered for payment or redemption, in the event that the Global Certificate is exchanged for Certificates,” Petron said.
It added that the minimum board lot size of the securities will stand at $200,000.
The net proceeds from the issue of securities, which will be in US dollars, will be used by Petron for the repayment of debts and for general corporate purposes.
The trustee, principal paying agent, calculation agent, transfer agent and registrar of the securities is the Hongkong and Shanghai Banking Corp. Ltd.
Last month, Petron reported that it swung to a net loss of P11.4 billion in 2020, from a net income of P2.3 billion in the year before, as sales declined due to the global health emergency. The company added that its consolidated revenues last year dropped 44% to 286 billion.
Shares of Petron in the local bourse inched down by 0.32% or one centavo to finish at P3.15 apiece on Thursday. — Angelica Y. Yang