By Denise A. Valdez, Reporter
SAN MIGUEL CORP. (SMC) is issuing $500-million perpetual securities under its $3-billion medium-term note and securities program.
In a disclosure to the exchange on Thursday, the conglomerate said it had agreed to sell the senior perpetual capital securities with a fixed initial distribution rate of 5.5% per annum.
As perpetual securities, the fixed-income bonds will have no maturity date. Investors, instead of redeeming their investments, are paid through a steady stream of interest earnings.
SMC tapped BofA Securities, Inc. and Standard Chartered Bank as joint lead managers, DB Trustees (Hong Kong) Ltd. as trustee, and Deutsche Bank AG, Hong Kong Branch as paying agent for the planned issuance.
The securities will be listed on the Singapore Exchange Securities Trading Ltd.
SMC’s $3-billion (about P148.25 billion) note and securities program allows it to issue notes and perpetual capital securities in tranches. Proceeds from the bonds are meant to support the company’s infrastructure projects and refinance existing loans.
Among the projects the bond program may support are the construction of its P62.7-billion Metro Rail Transit Line 7 project and the P734-billion Bulacan airport project, SMC said in earlier disclosures.
In the first quarter, SMC reported loans payable amounting to P169.36 billion and total current liabilities amounting to P426.59 billion. Its net debt-to-total equity stood at 0.85x.
The company posted an attributable net loss of P1.27 billion for the three-month period, swinging from its attributable net income of P5.71 billion a year ago, due to the impact of the coronavirus pandemic to its operations.
Shares in SMC at the stock exchange fell P1.60 or 1.60% to P98.20 apiece on Thursday.