Vol. XXII, No. 137 [ BusinessWorld Online ]
Thursday, February 12, 2009 | MANILA, PHILIPPINES
MANILA — Megaworld Corp., will raise P10.4 billion ($221 million) via a note and stock right offer to help fund a three-year expansion program.
The country’s third-biggest property firm by market value, which builds high-rise apartments and office buildings for the outsourcing sector, said the amount was part of the P30 billion it plans to spend over the next three years.
"The new fund-raising program will further enhance its strong capital base, ensuring that it can ride out the global financial turmoil and maintain its market leadership while capitalizing on new opportunities along the way," it told the Philippine Stock Exchange.
Megaworld said it issued this week P1.4 billion worth of seven-year corporate notes to 19 institutional investors, kicking off the fund-raising.
Megaworld’s board of directors has also approved a one-for-four right offer that will also entitle shareholders to subscribe to warrants, the company said.
The company seeks to finance P20 billion of the total spending using its own cash.
Megaworld, a unit of conglomerate Alliance Global, Inc., remains optimistic about growing its business despite a global credit crunch that has pushed major developed countries into recession.
"Megaworld continues to be confident about the property market, especially the sustainability of its two-pronged core business focus, namely the mid-income residential and business process outsourcing office markets," Megaworld Spokesman Francisco Canuto told the exchange.
Analysts expect the local outsourcing sector to continue growing on expectations that a recession-hit US economy will force more American companies to send their back office functions to low-cost centers.
The property company expects to accommodate around 14,000 jobs in the business process outsourcing sector as it completes five BPO buildings in Eastwood City, McKinley Hill and Newport City this year.
Megaworld Corp. earlier said it was on track to meet its 2008 net profit target of P3.8 billion, almost four times higher than a year earlier. Its third-quarter net income rose by more than a quarter to P1.07 billion, the second time in its history to breach the P1-billion mark. — Kristine Jane R. Liu with Reuters
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