Megawide Construction Corp. has successfully raised P4 billion from a preferred shares offering.
Megawide said in disclosure to the stock exchange it listed Series 4 preferred shares on the main board of the Philippine Stock Exchange through a virtual listing ceremony Friday.
“We are very happy about the outcome of the offering, which was fully taken-up including the oversubscription option, despite the noise going around during the offer period,” said Edgar Saavedra, Megawide chairman and chief executive said.
Megawide will use the proceeds from the offering to redeem the P4 billion Megawide preferred shares Series 1 (MWP) issued in 2014 to avoid huge step-up rate.
The redepemtion of the Series 1 preferred shares will also translate into an estimated annual savings of P184 million.
“The company also wants to take advantage of and maximize the prevailing window of low interest rates to generate interest cost savings. At the same time, this will allow us to further relax our maturity towers while maintaining flexibility and a comfortable debt-to-equity ratio,” said Ramon Diaz, Megawide Group chief finance officer.
Megawide is implementing a comprehensive long-term financial management program to strengthen the balance sheet and develop a more efficient capital structure.
Megawide’s airport venture GMR Megawide Cebu Airports Corp.(GMCAC) in May restructured P23.9-billion worth of debt as the pandemic wreaked havoc on the travel industry.
The debt restricting agreement, Megawide said, would temporarily free up around P3.6 billion in cash from 2021 to 2023 and reinforce GMCAC’s financial position to support operations while the ongoing pandemic limits air travels.
GMCAC’s principal debt was suspended and rescheduled to 2027-2029, when the travel industry is expected to have fully recuperated from the ill effects of COVID-19.
The company refinanced maturing obligations and issued Series 2A and 2B Preferred Shares in November last year to fund its aggressive growth agenda.
