Port operator International Container Terminal Services Inc. said Friday it raised $375 million from the issuance of new perpetual bonds to refinance outstanding securities.
The company owned by businessman Enrique Razon Jr. said it repurchased $345.5 million of its outstanding perpetual securities via tender offer, funded by the $375-million issuance of new senior perpetual securities.
“The liability management exercise allowed ICTSI to further strengthen its capital structure while realizing significant cost savings,” the port operator said.
The new perpetual securities confer a right to receive distributions at a rate of 4.875 percent per annum and were priced at 99.225 percent.
The rate of distribution for the securities will be reset every five years from May 5, 2024 and will increase by 2.5 percent per annum on May 5, 2024, in each case if the securities were not already redeemed by the issuer.
The securities were widely distributed with fund managers accounting for 46 percent, private banks for 30 percent and banks for 24 percent. By geography, Asia took up 82 percent with Europe at 18 percent.
“This capital management exercise is strategic and value accretive in many respects. The two most important of which are the extension of the call duration on almost half of ICTSI’s outstanding senior perpetual securities, and securing guaranteed annual cost savings from the lower distribution rate. We are pleased to have achieved these objectives particularly given the volatile market backdrop,” ICTSI senior vice president and chief financial and compliance officer Rafael Consing said.
Citigroup Global Markets Limited, The Hongkong and Shanghai Banking Corp. Ltd. and Standard Chartered Bank acted as joint lead managers and joint bookrunners for the new perpetual securities issuance and as dealer managers for the tender offer.
The tender offer ended Oct. 12.
The port operator earlier reported a net income of $92.6 million in January to June, or 12 percent lower than $105.7 million in the same period last year.