By Zinnia B. Dela Peña Updated July 07, 2009 12:00 AM [ philstar.com ]
MANILA, Philippines – Upscale property firm Megaworld Corp. is hoping to raise around P4.07 billion from the exercise of warrants by shareholders who subscribed to its recent stock rights offering, according to documents filed with the Securities and Exchange Commission (SEC).
On June 1, 2009, Megaworld issued 5.13 billion common shares with a par value of P1 per share, with detachable warrants. The company is offering up to 4.1 billion common shares upon exercise of the warrants.
The warrants are exercisable beginning on the second year from issue date and until five years from issue date. Each shareholder who has subscribed to the rights shares shall be entitled, upon full payment of the rights shares, to four bonus detachable warrants for every five rights shares acquired.
Megaworld said the underlying shares shall be taken from the remaining authorized and unissued capital stock of the company.
Proceeds from the exercise of the warrants will be used to fund the construction of a business process outsourcing center in Newport City in Pasay as well as working capital requirements for 2011-2012.
The company expects to raise a total of P9.23 billion from the rights offer and the warrant exercise assuming that all the warrants are exercised.
Megaworld is launching five new residential condominium projects this year that are estimated to generate around P12 billion in sales.
Among these projects include Two Central (a prestigious high-rise building located in Salcedo Village that will make available around 400 units), Tower Three in Eastwood City in Libis, Parkside Villas (a seven-cluster community that will rise beside the five-star Marriott Hotel in Newport City in Pasay, The Venice Residences (a seven-tower residential project in Mckinley Hill in Bonifacio Global City), and Morgan Suites Executive Residences (also within the 50-hectare Mckinley Hill township).
Around 80 percent of the company’s sales come from residential projects while 10 to 15 percent come from lease operations.
Megaworld has set aside P8 billion to P10 billion for its capital expenditures this year, mostly to go to project development.
Part of the capex will be used to fund the construction of a new hotel under the Richmonde brand, in Eastwood City.
The new four-hotel will offer a total of 100 to 150 rooms with the development cost pegged at $70,000 per room. A third branch of the Richmonde Hotel is also being planned in Manila’s Binondo district where Megaworld is building a township to be called Cityplace.
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