SM Prime Holdings Inc., the largest integrated real estate developer, has successfully raised P10 billion from the issuance of 10-year fixed rate bonds amid strong demand from investors.
SM Prime vice president for finance Ma. Teresa Cecilia Reyes said in a text message the base offer of P5 billion worth of bonds and a P5-billion oversubscription option were fully subscribed at the end of the offering period.
Reyes said total demand reached P29 billion, or more than 4.8 times oversubscribed at the base offer. The bonds, which will be issued on July 26, carry an interest rate of 4.2005 percent a year.
The P10-billion bond offer forms part of the P60 billion worth of fresh funds that the property company plans to raise over the next three years to finance capital expenditures.
The Securities and Exchange Commission earlier approved the P60-billion shelf registration of SM Prime.
SM Prime president Hans Sy said the retail bond issue would sustain SM Prime’s development roadmap, which is geared toward provincial expansions and mostly allotted on malls and offices developments.
“We remain optimistic on the huge growth potential in the provinces where large areas remain unserved,” Sy said.
SM Prime tapped BDO Capital & Investment Corp., BPI Capital Corp., China Bank Capital Corp. and First Metro Investment Corp. as bond underwriters and bookrunners.
East West Banking Corp., PNB Capital and Investment Corp. and United Coconut Planters Bank joined as participating underwriters of the bond issue.
SM Prime operates four core businesses—malls, residential, commercial and hotel and convention centers. It plans to spend P60 billion annually over the next three years to further expand its presence in other parts of the country.
The group as of end-March had 56 malls operating in the Philippines, with a total gross floor area of 7.3 million square meters.
The company also operates six malls in Chinese cities—Xiamen, Jinjiang, Chengdu, Suzhou, Chongqing and Zibo.
Share price of SM Prime on Wednesday closed at P29.95, down P0.05 from the previous day’s close.