Petron Corp., the country’s lone oil refiner, plans to issue up to P50 billion worth of fixed-rate bonds as part of a capital raising program.
Petron said in a disclosure to the stock exchange Monday the executive committee of its board of directors approved the filing of P50-billion worth of peso fixed-rate bonds with the Securities and Exchange Commission.
Petropn will offer the bonds to the public in one or more tranches during the period of shelf-registration, including an initial offering and issuance of up to P18-billion worth of the bonds.
The committee appointed BDO Capital & Investment Corp. as the sole issue manager and the group of BDO Capital & Investment Corp., China Bank Capital Corp., Philippine Commercial Capital, Inc., PNB Capital and Investment Corp. and SB Capital Investment Corp. as joint lead bookrunners and joint lead underwriters.
It also approved the filing of the appropriate registration statement, prospectus and offer supplement with the Securities and Exchange Commission; execution of relevant agreements; filing of a listing application with Philippine Dealing & Exchange Corp.; and other terms and conditions to be determined by management.
Petron announced in April it would issue $550 million in senior perpetual capital securities “for the repayment of indebtedness and for general corporate purposes.”
The securities will carry a rate of 5.95 percent per annum and will be issued in registered form in denominations of $200,000 and integral multiples of $1,000.
Petron operates the only integrated oil refinery in the Philippines. It had an overall market share of 24 percent of the Philippine oil market in the first half of 2020 in terms of sales volume, based on company estimates using internal assumptions and calculations and industry data from the Department of Energy.
Petron is also a leading player in the Malaysian market.
The company announced that it would restart its 180,000-barrel-per-day refinery in Bataan province amid optimism of a stronger financial performance this year.
“Unlike Shell, Petron is a modern refinery which we have upgraded only about five years ago. And the refinery is very competitive, and we see no reason for us to shut down the refinery,” Petron president and chief executive Ramon Ang said earlier.
Pilipinas Shell Petroleum Corp. shut down its 110,000-barrel-per-day facility in Batangas province last year amid the COVID-19 pandemic.
Petron also temporarily closed its refinery for economic and maintenance reasons starting February.
Ang expressed optimism about Petron’s financial performance after posting a net income of P1.73 billion in the first quarter, a reversal of its P4.9-billion net loss in the same period last year.
Petron attributed the recovery to the recent improvement in international oil prices and the implementation of cost-cutting measures.