Local property giant SM Prime Holdings Inc. has obtained approval from its board to raise as much as P25 billion from a peso-denominated bond offering in the retail market.
The bonds will be offered with tenors of five years and 6 months, seven and 10 years, SM Prime said in a disclosure to the Philippine Stock Exchange Monday.
“The proceeds of the bonds will be used to finance capital expenditures for the expansion of the company’s malls, offices and hotel operations,” the disclosure said.
The board of directors also authorized the management to negotiate and finalize the terms and conditions, including pricing, tenor and any increase in issuance amount, and execute any and all documents necessary, to implement the retail bond issue.
The offering is part of SM Prime’s earlier announced plans to raise around $740 million through a mix of peso and dollar borrowings this year to fund its expansion here and in China.
Apart from the peso bond issuance, SM Prime was also looking to raise $300 million from a syndication of dollar debt to fund landbanking and mall development in China.
The company recently found a new location in the city of Yangzhou in central Jiangsu province to build a new mall in China. A 10-hectare property was acquired from the local government through a long-term lease. Yangzhou is historically one of China’s wealthiest cities, known during various dynasties for producing great merchant families, poets, painters and scholars.
All told, SM Prime has earmarked about P70 billion for capital spending this year.
The company has also unveiled a five-year roadmap to grow its businesses in the Philippines and mainland China for an estimated investment of around P400 billion.
At the end of a five-year roadmap in 2018, SM Prime expects to double both its net profit and revenue base and boost return on equity to mid-teen levels from around 11 percent.
Over the next five years, SM Prime expects to have a total of 85 shopping malls in its portfolio, of which 74 will be in the Philippines and 11 in China. This will be double the portfolio as of end-2013, which consisted of 48 local malls and five operating malls in China.
The roadmap also envisions that the residential segment will bring to the property market a total of 139,628 square meters for 41 projects over the five-year period.
Meantime, SM Prime grew its first-quarter net profit by 11 percent year-on-year to P4.58 billion as revenues were boosted by new mall opening and expansion.
Consolidated revenues rose 3 percent to P15.35 billion. Rental revenues accounted for 56 percent of the consolidated revenues and were up 12 percent to P8.56 billion.
seo tools
No comments:
Post a Comment