The Securities and Exchange Commission on Thursday approved the P40-billion shelf registration of oil refiner Petron Corp.
Petron said it initially planned to issue P15 billion worth of five and seven-year bonds, with an oversubscription option for another P5 billion.
The remaining P20 billion will be placed under shelf-registration that could be issued over the next three years.
Proceeds for the fund raising activity will be used to refinance existing debt and fund working capital requirements.
BDO Capital & Investment Corp., BPI Capital Corp. and SB Capital are the joint issue managers and joint underwriters for the offering.
The bonds, which will be listed with the Philippine Dealing & Exchange Corp., were rated PRS Aaa by Philippine Ratings Services Corp.
PRS Aaa is the highest rating assigned by PhilRatings. Obligations rated PRS Aaa are of the highest quality with minimal credit risk.
The rating was arrived at after considering Petron’s leading market position in the Philippines, its increasing presence in Malaysia and its defined strategies to support future growth.
PhilRatings also noted the company’s strong revenue generation, supported by growing sales volume, with profitability margins expected to improve over the projected period.
Petron is the largest integrated oil refining and marketing company in the country with an overall market share of 32.81 percent of the Philippine oil market in 2015 in terms of sales volume based on company estimates using its internal assumptions and calculations and industry data from the Energy Department.
The company operates Limay Refinery in Limay, Bataan, which has a crude oil distillation capacity of 180,000 barrels a day. It recently completed the $2-billion Phase 2 of the Refinery Master Plan project for the Limay Refinery, which enabled the company to produce more valuable products and increase production of petrochemicals.