Conglomerate Aboitiz Equity Venture (AEV) secured the highest rating from local debt watcher Philippine Rating Services Corp. (PhilRatings) for its proposed issuance of P10-billion corporate bonds with maturity dates of seven and 10 years.
In a disclosure posted at the website of the Philippine Stock Exchange, it was announced that the proposed bonds issuance of AEV received a “PRS Aaa” rating from PhilRatings, the highest possible rating assigned by the debt watcher.
According to PhilRatings, obligations rated “PRS Aaa” are of the highest quality with minimal credit risk, an indication of the extremely strong capacity of the obligor to meet its financial commitment on the obligation.
PhilRatings said that AEV has a sustained and strong operating performance, with high levels of cash and cash flows in relation to debt service requirements; sound capital structure with a conservative leverage position and flexibility to accommodate additional debt as required; positive growth prospects for its business portfolio; and a conservative and experienced management team.
Earlier this month, AEV filed its application with the Securities and Exchange Commission (SEC) for the registration of the P10-billion corporate bonds.
AEV appointed First Metro Investment Corp. as issue manager, and FMIC, together with Hong Kong and Shanghai Banking Corp., as joint lead underwriters.
AEV said that it expects net proceeds amounting to approximately P9.9 billion, which it intends to use to fund its working capital, among others.
“The net proceeds from the offer is estimated to be P9.9 billion alter deducting expenses related to the offer. The balance will be used by the company to replenish working capital which was used to fund the purchase of 14.542 million shares in Union Bank amounting to P1.8 billion,” AEV said in its prospectus filed with the SEC.
Also, some of the proceeds will be used to finance the company’s planned investments and for other general corporate purposes pursuant to its operations as a holding company.
AEV further said it is looking at major investment opportunities that build on its established competencies, including, but not limited to the power generation and distribution, infrastructure, renewable fuels, and real estate industries.