If opportunity presents itself
CONGLOMERATE Ayala Corp. said “it may” issue dollar-denominated perpetual securities again if the opportunity presents itself following the company’s successful issuance of $400-million fixed-for-life senior notes recently.
“The fact that we were able to do it, I think we can do it again if we wanted to,” Ayala Corp. Chief Finance Officer Jose Teodoro Limcaoco told reporters following an event organized by the company over the weekend.
“In fact, the demand [was]so strong we had $2.5 billion of orders and we only did an issue of $400 million,” he added.
The conglomerate launched its perpetual note issuance at an annual coupon of 5.125 percent, fixed until maturity date. The transaction was made through its wholly-owned subsidiary AYC Finance Limited.
The notes issue was the first corporate fixed-for-life issuance with no coupon step-up in Southeast Asia and the first fixed-for-life note with no step-up (and reset) deal in the Philippines.
“It’s an opportunity, and that’s a very hard structure, it’s a very unique structure because you have to have impeccable credit,” Limcaoco said.
“[The issuance was] very rare and the name has to be, my words, impeccable, because there’s no date you will get the money back so the investors have to believe that the company will be around forever,” he said.
“When we raised dollars, it’s because we know that what we’ll be funding are dollar assets so it doesn’t necessarily mean overseas but it means that the revenues and the profits are dollars.”
Of the $400 million raised, half will be used to refinance the company’s maturing debts and the remaining to fund its investments.
“We run a five-year plan. But plans always get reviewed each year so if we see other opportunities then certainly we have to fund that but right now, our budget and our plans are okay,” Limcaoco said.
“I think we’re okay for the rest of the year after this $400 million issue. I don’t think we’ll be coming to the market this year unless [there is a]super opportunity,” he added.
Ayala Corp. is the oldest and one of the largest conglomerates in the country and is led by magnate Jaime Zobel de Ayala.