CONGLOMERATE Ayala Corp. is looking to raise between P10 billion and P15 billion from a bond float later this year to raise funds to refinance its maturing obligations.
Ayala Corp. Managing Director and Chief Finance Officer Jose Teodoro Limcaoco said the company will offer the bonds in the third quarter of the year.
“Our filing is initially thought to be P20 billion. We will be using that in the next three years in terms of the capital market,” Limcauco said in press briefing on Friday.
“We think the market by then will be conducive. Clearly the elections will close the window. We are hoping we will probably go out [to the debt market]after the election, maybe in the third quarter,” he added.
Limcauco said proceeds of the bond float will be used to settle obligations that are falling due in April next year. He did not specify the amount of said maturing debt.
The planned bond float is part of the P20 billion that its board approved on Friday for shelf registration with the Securities and Exchange Commission (SEC).
“In addition to bilateral peso facilities, the bond proceeds… will cover the peso funding requirements up to 2019. The bonds will be sold through general public offerings,” the company said in a disclosure to the Philippine Stock Exchange (PSE).
For this year, the company has programmed a capital expenditure (capex) at the group level of P174 billion, down from last year’s actual spending of P130 billion. The programmed capex for 2015 had been P187 billion, but this was not fully utilized due to delays in some of its projects, hence the remainder was reallocated to Ayala Land Inc.
Ayala Corp. said bulk of this year’s capex will go to property development and telecom upgrade.
At the parent level, it earmarked P22.4 billion in capex for its power generation projects that are already in the pipeline.
“As you know, we are building a plant in Kauswagan in Mindanao. About half of that [parent level capex]will go to Kauswagan,” Limcaoco said.
“We have started ground clearing in Bataan and we have some other capex at the parent level, small investments that we will be making,” he said.
On Thursday, Ayala Corp. said its net income last year surged by 20 percent to P22.3 billion, surpassing its self-imposed target of P20 billion one year ahead of schedule. The profit growth was propelled by the strong performance of its real estate, telecom and power generation units.