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Ayala Corp. mulls more long-term bond offerings

Posted on November 23, 2012 08:54:41 PM [ BusinessWorld Online ]

LISTED AYALA Corp. is planning to offer bonds longer than 15 years and foreign currency-denominated papers to raise more funds to finance its forays into infrastructure, an official said on Friday.

“We have done the 15 years [tenor] already. As we get into more infrastructure-related investments, the need to extend the tenor becomes more compelling,” said Ramon G. Opulencia, Ayala’s managing director and treasurer, at the sidelines of a listing ceremony at the Philippine Dealing Exchange Corp. (PDEX).

Ayala on Friday listed P10 billion worth of 5.45% seven-year bonds that were issued early this month and will mature in 2019.

The bonds were meant to “fund its capital requirements to enable the company to realize opportunities for expansion both through organic growth of its existing business lines as well as value- accretive acquisitions,” Ayala said in an earlier disclosure.

“I think the market is very conducive for developmental and ground-breaking work, and therefore we are thinking of more innovations,” Mr. Opulencia added, but declined to go into the details of the new bonds.

Dollar-denominates issuances are also a possibility, he added.

“I think there are a lot of opportunities to do ground-breaking deals, and one of the innovations we are thinking is a non-peso denominated listed security, the first in the Philippines for a corporate,” he added.

Asked how much the company intend to raise, he only said: “Right know, you should not issue more than P8 billion worth [of dollar bonds] for a company like us. It should be at least $200,000 million worth.”

In April, Ayala issued P10 billion worth of 15-year, 6.875% peso-denominated bonds that will mature in 2027. The money raised would fund its operations and possible expansion.

The company has announced more projects in power generation and infrastructure such as railways and other transportation projects.

For 2012, the conglomerate had allotted P91 billion in capital expenditures to finance real estate development, telecommunication network improvement, water business investments, and acquisitions.

The company’s core net income grew by 31% to P9.3 billion in the nine-months to September driven by its property, banking, and water businesses, which offset the decline in equity earnings from its telecommunications business.

Shares of Ayala added 1.38% or P6.60 to P486.60 apiece when the stock market closed on Friday. -- Cliff Harvey C. Venzon       

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