SM Prime Holdings Inc., the country’s leading integrated property developer, plans to raise as much as P10 billion from the sale of 10-year fixed-rate bonds.
The P10-billion bond issuance forms part of the P60-billion shelf registration to be issued over the next three years approved by SM Prime’s board of directors.
SM Prime said in a disclosure to the stock exchange the company would initially offer up to P5 billion with an over subscription option of up to P5 billion worth of fixed-rate bonds.
“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,” SM Prime said.
Proceeds from this year’s bond offering will be used to partially finance the group’s programmed capital expenditures in 2016.
SM Prime earlier said it would earmark at least P60 billion annually for the next three years to achieve its target of doubling net income to P32 billion by 2018.
The group’s expansion program focuses mainly on the expansion of shopping malls in the provinces which present major opportunities for higher growth.
SM Prime said in the housing sector, it would continue to serve Metro Manila while slowly moving towards the provincial areas in the medium term.
The company is slated to open five new malls in the Philippines this year.
SM Prime said residential unit SM Development Corp. would launch 11,000 to 14,000 units in Quezon City, Parañaque, Las Piñas and Pasay City.
It also intends to gradually enter the economic housing market by launching new mixed-use developments in Nueva Ecija, Pampanga and Cavite in the second half of this year.
A number of companies filed for shelf registration with the Securities and Exchange Commission to take advantage of the expanded shelf registration rules.
Among these companies were Ayala Corp., which is raising P20 billion; Ayala Land Inc., P50 billion; San Miguel Corp., P80 billion and Del Monte Pacific Ltd., $360 million.
Under SEC’s s shelf registration program, securities to be issued in tranches may be registered for an offering to be made on a continuous or delayed basis for a period not exceeding three years.