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ALI to raise P15B

By ALBERT CASTRO [ Malaya.com.ph ] February 22, 2012

Ayala Land Inc. said it has tapped BPI Capital and Hongkong and Shanghai Banking Corp. as lead underwriters and issue managers for a planned P15 billion fund-raising activity, amid the company’s optimistic outlook on the Philippine property market.

"The bonds, which are to be registered with the Securities and Exchange Commission, will have tenors of seven and 10 years. Net proceeds will be used to partially finance our planned capital expenditure for 2012," Ayala Land said.

Ayala Land plans to spend P37 billion as capex for the year, which will be divided among the company’s various projects in the residential, office, retail, and tourism segments.

Last year, the company spent P30 billion.

Jaime Ysmael, chief finance officer of Ayala Land, said about 56 percent of the company’s capex will be spent on the residential segment. These projects would primarily be self-funding given the company’s P25 billion cash and cash equivalents.

Ayala Land intends to launch a total of 24,800 units across all its residential brands for the year, more than last year’s 20,613 units.

The proceeds from the bond offer will most likely be spent on the other segments of the company’s projects as Ayala Land expands its portfolio in the office, retail, and tourism segments.

The company plans to expand its budget hotels while a number of its business process outsourcing buildings had been in the pipeline for the past years.

Antonino Aquino, Ayala Land president, said the bonds will have longer terms so as to "flatten out" the maturity of their obligations in relation to cashflow as its existing debts are "fairly spread out over the next five years."

Ayala Land said it closed 2011 with a "strong" balance sheet given good pre-sales of various residential projects and the P10-billion notes it issued early last year. These provided liquidity for the company.

Ayala Land’s total borrowing stood at P34.53 billion, with its debts maturing in more than a year standing at P28.34 billion.

For the first nine months of last year, Ayala Land raised P13.01 billion in new borrowings.
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