Philippine Daily Inquirer
1:10 am | Saturday, September 29th, 2012
Diversifying conglomerate San Miguel Corp. listed on the Philippine Stock Exchange Friday P80 billion worth of a new series of preferred shares, the biggest capital market foray in the country to date.
SMC listed 1.07 billion series 2 preferred shares that were recently sold to retail and institutional investors at P75 each. The bulk of the investment comprising 67.6 percent flowed to the sub-series 2A with an annual dividend rate of 7.5 percent and a step-up rate in five years. This was listed under the ticker “SMC2A.”
Another 23.9 percent of the issue consisted of sub-series 2C—listed under ticker “SMC2C”—that carries an annual dividend rate of 8 percent with a step-up provision in 10 years. The remaining 8.5 percent consisted of sub-series 2B under ticker “SMC2B” that carries an annual dividend rate of 7.625 percent and a step-up provision on the 7th year.
SMC said this landmark capital-raising activity was completed as investors were seeking higher yields in a low-interest environment. The listing gave investors the option to buy or sell the preferred shares in the secondary market ahead of SMC’s redemption of the debt paper.
The preferred shares are peso-denominated, perpetual, cumulative, nonparticipating and nonvoting. SMC has the option to redeem the shares starting the 3rd, 5th and 7th year and every dividend payment thereafter or otherwise pay a higher rate (step-up provision).
“Our presence today points to our company’s commitment as an active participant in the capital markets and a value creator for the many investors who hold San Miguel shares or bonds,” SMC president and chief operating officer Ramon Ang said in a statement.
From its stable core food, packaging and beverage businesses, San Miguel embarked on a diversification program in 2007 and has since gained a foothold in high-yielding industries such as energy, fuel and oil, infrastructure, airlines and mining.
“Ever since we embarked on our diversification strategy in 2007, our goal has been to make a deep and lasting positive impact on the Philippine economy through our businesses,” Ang added.
Bulk of the proceeds from the series 2 preferred shares issuance will be used for the redemption of the company’s outstanding series 1 preferred shares with the balance going to general corporate expenses, including short-term debt repayment.
HSBC was the lead issuer for this transaction while the bookrunners included Union Bank, BDO Capital, China Bank, RCBC Capital, First Metro Investment, ING, PCCI, SB Capital, Standard Chartered Bank and UCPB. Participating underwriters were Insular Investment Corp. and PNB Capital and the selling agents were Bank of Commerce and trading participants of the PSE.
Follow Us
Recent Stories:
Short URL: http://business.inquirer.net/?p=84542
Tags: Business , capital buildup , preferred shares , San Miguel Corp.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
seo tools
No comments:
Post a Comment