• Ayala Corp. P20-B shelf registration gets SEC OK

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    AYALA Corp., the country’s oldest conglomerate, has obtained the approval of the Securities and Exchange Commission (SEC) to sell P20 billion worth of fixed-rate bonds under shelf registration.

    In an en banc meeting, the SEC authorized Ayala Corp. to initially float P10 billion worth of bonds under shelf registration, with the remainder to be offered at some other time in the future within the next three years.

    Proceeds of the initial offering will be used to refinance maturing obligations next year.
    Under shelf registration, companies may sell securities to the public in tranches without having to issue a separate prospectus for each offering.

    Teodoro Limcauco, chief finance officer of Ayala Corp., earlier said they prefer raising funds early to meet some monetary obligations that will fall due in April next year.

    “If you look at our maturity profile, we have enough cash on hand to meet spending needs and meet maturities this year. We just think that it is opportunistic that the Q3 [third quarter]will provide a good window for raising money this year,” Limcauco earlier said.

    The fixed-rate bonds will have a tenor of seven years and will pay a quarterly coupon based on a rate that is still to be determined. The bonds will be issued at a minimum denomination of P50,000 each and increments of P10,000.

    Underwriters for the bond float are BDO Capital and Investment Corp., BPI Capital Corp., China Bank Capital Corp., and First Metro Investment Corp.

    “Ayala reserves the right to redeem the bonds five years after the issuance,” it said.

    Ayala, which has major interests in the real estate, banking and telecommunications industries, is upbeat about its investments in new platforms, specifically in power and transport infrastructure, healthcare and education, and automotive and manufacturing.

    Jaime Augusto Zobel de Ayala, the conglomerate’s chairman and chief executive officer, said a five-year plan beginning this year includes ramping up net profit to P50 billion, or more than double last year’s earnings of P22.3 billion.

    Amid the political changes happening in the country, the group, which has invested P500 billion in the Philippines over the last five years, remains optimistic about the overall economic environment in the Philippines. Because of this, it plans to keep the bulk or 90 percent of its business in the domestic market, with overseas expansion to account for only 10 percent.

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