San Miguel orders banks to arrange dollar-denominated bond offer

SAN MIGUEL CORP. (SMC) has tapped banks to set up its planned offering of dollar-denominated bonds from its $3-billion securities program.

In a disclosure to the exchange on Monday, the conglomerate said it had mandated BofA Securities, Inc. and Standard Chartered Bank as joint global coordinators and joint bookrunners, and DBS Bank Ltd. as joint bookrunner for the planned offering.

The banks started arranging a series of investor calls across Asia and Europe on July 20, after which the offering of a Regulation S only, dollar-denominated senior perpetual securities may follow.

The bonds will fall under SMC’s $3-billion medium-term note and securities program registered at the Singapore Exchange Securities Trading Ltd. (SGX-ST).

“Consistent with earlier disclosures, no public offering of the securities will be made in the Philippines, the United States or in any other jurisdiction where such offering is restricted or prohibited, or to US persons,” it said.

SMC did not specify as of Monday’s disclosure the amount and the use of proceeds from the initial bond offering.

“The company shall make further disclosures relating to the issuance of the securities and the listing thereof with the SGX-ST at the appropriate time,” it said.

In February, SMC said its $3-billion bond program (about P152.22 billion) allows it to issue notes and perpetual capital securities in tranches. These securities will have a US dollar denomination, or any currency agreed upon by the company and its dealers.

Proceeds from the bond program are meant to support SMC’s infrastructure projects and to refinance existing obligations. Among the projects it had mentioned before are the construction of the P62.7-billion Metro Rail Transit Line 7 and the P734-billion Bulacan airport.

As of the first quarter, SMC’s loans payable stood at P169.36 billion and total current liabilities at P426.59 billion. Its net debt-to-total equity was at 0.85x.

The company swung to an attributable net loss of P1.27 billion for the period, a turnaround from the P5.71-billion attributable net income during the same period last year, due to the impact of the coronavirus pandemic to its operations.

Net sales fell 15% to P214.07 billion as income from operations declined 62% to P11.73 billion.

Shares in SMC at the stock exchange picked up 20 centavos or 0.20% to close at P98.70 each on Monday. — Denise A. Valdez