SM Prime sets price for bond offer


Property developer SM Prime Holdings Inc. on Tuesday said it has priced its P10-billion seven-year bond sale at a coupon rate of 5.0994 percent per annum.

The said rate is higher than the secondary market trading of 4.3981 percent.

The company will sell an initial P5 billion and another P5 billion as its oversubscription option. The bond offer will be conducted from November 2 to 8. The retail bond is set to be issued on November 15.

“The proceeds of this latest retail bond will be used to pursue expansion opportunities across our business segments, which will help sustain the company’s growth,” said John Nai Peng Ong, chief finance officer of SM Prime.

The proposed issuance is the third tranche of debt securities to be issued from SM Prime’s P100-billion debt securities program registered with the Securities and Exchange Commission.

BDO Capital and Investment Corp. and China Bank Capital Corp. serve as joint-issue managers. BPI Capital Corp., East West Banking Corp., First Metro Investment Corp., SB Capital Investment Corp. and RCBC Capital Investment Corp. were picked as  joint lead underwriters.

In August, the company reported that its net income rose 12 percent to P11.6 billion in the first semester, from P10.4 billion last year, thanks to its residential business.

For second quarter alone, the company reported that its income grew more than double to P5.2 billion from last year’s P2.1 billion.

However, its consolidated revenues in the first semester declined by 6 percent to P41.1 billion, from P43.7 billion last year.

SM Prime’s residential business, which accounted for 60 percent of SM Prime’s consolidated revenues and led by SM Development Corp. (SMDC), registered a 3-percent increase in revenues to P24.5 billion in the first half from P23.7 billion a year ago.

Its operating income improved by 8 percent to P10.4 billion in the first half from P9.7 billion last year.

SMDC’s net reservation sales rose by 30 percent to P55.1 billion in the first semester from P42.4 billion last year.

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