Megaworld raising P12b to fund projects

Property developer Megaworld Corp. is raising up to P12 billion from the issuance of seven-year fixed-rate bonds to finance development of four townships.

Megaworld said in a filing with the Securities and Exchange Commission the amount would represent the initial tranche of the P30-billion debt securities program approved by its board.

The company said initially, the program would involve P8 billion worth of fixed-rate bonds due 2024 with an oversubscription option for another P4 billion.

Megaworld said assuming the oversubscription option was issued, it would use the P12-billion proceeds to finance projects within Iloilo Business Park, McKinley Hill, McKinley West and Uptown Bonifacio.

The company said over the next three years, it would spend P1.16 billion in Iloilo Business Park, P2.14 billion in McKinley Hill, P2.4 billion in McKinley West and P7.2 billion in Uptown Bonifacio.

Any shortfall from the net proceeds will be funded by the company using internally generated funds, it said.

The four developments are among the 20 integrated urban townships that Megaworld has under its portfolio.

The proposed issuance received a rating of PRS Aaa from the Philippine Rating Services Corp.  It has a stable outlook, which means the assigned rating is likely to remain unchanged in the next 12 months. PRS Aaa is the highest possible rating given by PhilRatings.

PhilRatings considered the company’s sound capitalization and high-quality management, as well as expectations that Megaworld’s growth strategy will significantly benefit from the continued positive performance of the country’s economic growth drivers. 

The bonds will be listed with the Philippine Dealing & Exchange Corp.

Megaworld hired BDO Capital and Investments Corp. as the issue manager and lead underwriter for the bond offering.

Megaworld has been expanding its recurring income portfolio by developing office, commercial and hotel projects across its townships.

Topics: Megaworld Corp. , fixed-rate bonds
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