Conglomerate San Miguel Corp. said it is raising up to P30 billion through a peso bond offering to refinance debt and invest additional equity in existing businesses.
San Miguel said in a filing with the Securities and Exchange Commission it would issue P20 billion worth of fixed-rate bonds with an oversubscription option for another P10 billion, representing the third tranche of the company’s P60-billion bond shelf registration previously approved by the SEC.
The bonds will be comprised of 5-year Series E Bonds due 2023, 7-year Series F Bonds due 2025, and 10-year Series G Bonds due 2028.
The conglomerate tapped seven banks including BDO Capital and Investments Corp., BPI Capital Corp., China Bank Capital Corp., First Metro Investments Corp., ING Bank, SB Capital Investment Corp. and Standard Chartered Bank as the joint underwriters and book runners for the offering.
The bonds will be listed with the Philippine Dealing and Exchange Corp.
San Miguel said proceeds from the bond sale would be used to refinance existing US dollar denominated obligations or to invest in existing businesses, including SMC Global Power Holdings Corp., San Miguel Holdings Corp. and San Miguel Properties Inc.
Philippine Rating Services Corp. assigned an issue rating of PRS Aaa to San Miguel’s P30-billon bond offering with a stable outlook.
Obligations rated PRS Aaa are of the highest quality with minimal credit risk. A stable outlook indicates that the rating is likely to be maintained or to remain unchanged in the next 12 months.
PhilRatings said it considered the conglomerate’s operating businesses which provide sustainable income streams and cash flows and strong market position, solid track record and continuous efforts to manage debt.
San Miguel and its subsidiaries have been refinancing their dollar-denominated debts as the peso continues to weaken against the dollar and rising interest rates.
SMC Global Power raised P25 billion from issuance of fixed rate bonds in November 2017.
Share price of San Miguel closed lower by 0.6 percent to P144 Wednesday.