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Robinsons Land eyes bond sale

Posted on February 27, 2014 11:33:57 PM

GOKONGWEI-led Robinsons Land Corp. (RLC) plans to raise up to P15 billion in fresh capital by selling bonds this year, company officials said yesterday.

The announcement comes after its parent JG Summit Holdings, Inc.’s successful P30-billion issuance of fixed rate bonds, which the company listed on the Philippine Dealing & Exchange Corp. yesterday.

Officials told reporters that the conglomerate will give the move a follow-through to fund its capital expenditures (capex). The bond issue will be timed ahead of the maturity of debts worth P10 billion.

“We don’t have a feeling on the quantum [sic] yet. I would say it will be between the P10-15 billion range,” JG Summit President and Chief Operating Officer Lance Y. Gokongwei said on the sidelines of the bond listing at The Enterprise Center in Makati City.

“I anticipate [that to happen] in a few months. We have maturities in July and August so probably a little prior to that,” added Mr. Gokongwei, who also serves as the vice-chairman and chief executive officer of RLC.

Bach Johann M. Sebastian, JG Summit and RLC senior vice-president, said the new bonds could have a tenor of seven to 10 years, adding the company might hire “the same group of arrangers for this one.”

BDO Capital & Investment Corp., BPI Capital Corp., First Metro Investment Corp., The Hongkong and Shanghai Banking Corporation Ltd., and Standard Chartered Bank served as the joint lead managers and underwriters for its most recent transaction.

“We will take the opportunity to raise a little bit more to fund the capex.” Mr. Sebastian said.

Last month, RLC announced that it will be spending P16 billion in capex this year. The developer said 80% will be allotted for the construction and completion of shopping malls, office buildings and hotels; while the balance will be spent for residential condominiums and housing units.

JG Summit’s P30-billion bonds listed yesterday are broken down as follows: P24.51 billion worth of five-year bonds, P5.31 billion worth of seven-year bonds, and P176.34 million worth of 10-year bonds.

The bonds due in 2019 carry an interest rate of 5.2317% per year; bonds due in 2021 pay an interest rate of 5.2442% per year; while bonds due in 2024 carry a rate of 5.3% per year.

JG Summit had said in its submission to the Securities and Exchange Commission that bond proceeds will be used to help pay for the acquisition of 305.69 million Meralco shares from San Miguel Corp., as well as general corporate purposes.

JG Summit in September last year purchased San Miguel’s 27% stake in Meralco for about P72 billion.

The Gokongwei conglomerate had initially raised some P20.8 billion to fund the purchase via an overnight equity placement of P8.8 billion and sale of P12 billion worth of shares in Universal Robina Corp. that diluted the holding firm’s stake in its food-and-beverage unit to P55.7% from 60.55%.

JG Summit’s investment in Meralco marked the conglomerate’s foray into the power distribution business, which adds to its existing portfolio that also includes airlines, real estate, banking and petrochemicals.

Its real estate investment unit, RLC, was incorporated in 1980 to engage in the business of selling, acquiring, constructing, developing, leasing and disposing of real properties such as land, buildings, shopping malls, commercial centers and housing projects, hotels and other variants and mixed-used property projects.

Yesterday, shares of JG Summit ended at P46.15 apiece, up P1.05 or 2.33% from P45.10 on Wednesday; while those of RLC were unchanged at P20.40 apiece. -- Claire-Ann Marie C. Feliciano
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