Listed conglomerate Ayala Corp. (AC) has secured approval from the Securities and Exchange Commission (SEC) to proceed with its P15-billion fundraising through sales
of preferred shares to refinance its peso-denominated debts.
Based on its SEC regulatory filing, AC will offer 30 million new and separate series of Preferred Class B shares, priced at P500 per share. The primary offer is composed of 20 million shares, and an additional 10 million shares are set as oversubscription option.
The P14.92-billion net proceeds, after listing related expenses and taxes, will be used to settle the company’s P12.95 billion bank loans. It owes Metrobank P1.46 billion, Banco de Oro P10 billion, and several corporate notes to various lenders totaling P1.49 billion.
The preferred shares will have a quarterly dividend rate. The company will set a benchmark rate prior to the issue date, which shall be based on five-year or seven-year PDST-R2 benchmark plus spread. BDO Capital & Investment Corp. was appointed as the issue manager.
The preferred shares may be redeemed at the end of the fifth, seventh, and 10th years after the sale. Payment is cumulative. The series of preferred shares are non-convertible, with no voting and preemptive rights.
The shares will be subject to Philippine Stock Exchange approval, and will be traded in the local bourse under the “ACPB” symbol.
The oldest conglomerate in the country grew its first half consolidated net income by 34 percent to P9.8 billion, driven by higher sales of its property, telecommunications and water utility subsidiaries.
The company has earmarked P24 billion for capital expenditures in 2014 for its investments in the power and transport sectors, several of which are public-private partnership projects. The company is investing a total of $1 billion for energy and infrastructure projects for the period 2012 to 2016.
Founded in 1834 and incorporated in 1968, AC is the holding company of the Ayala family’s businesses, which include water (Manila Water Company Inc.), telecoms (Globe Telecom Inc.), property (Ayala Land Inc.), semiconductors (Integrated Micro-Electronics Inc.), banking (Bank of the Philippine Islands), and education (LiveIt Investments), among others. It is 50.56-percent owned by Mermac Inc., 10.52-percent by Mitsubishi Corporation and 38.92-percent by the investing public.