GLOBE Telecom Inc. on Monday said the expiration for its consent solicitation exercise for the amendment of the terms of its fixed-rate bond issuances due 2017, 2019, 2020 and 2023 has been moved forward to August 19 this year from the original target of September 5.
Globe said in a disclosure to the Philippine Stock Exchange that the change in date was decided upon after getting majority consent from its shareholders to effect the amendments to the bonds.
The consent solicitation exercise, which commenced on August 8, includes the company’s five-year-and-three-month 5.75 percent fixed rate bonds maturing on September 1, 2017; its seven-year 6 percent fixed rate bonds maturing on July 17, 2019; its seven-year 4.8875 percent fixed rate bonds maturing on July 17, 2020; and its 10 year 5.2792-percent fixed-rate bonds maturing on July 17, 2023.
“The consent forms should be received by the solicitation agent on or before 5 p.m. of August 19. After the said date and time, the consent solicitation is considered closed, and consent forms will no longer be accepted,” Globe said.
Following the change in expiration date, the execution date on which the issuer and Bank of the Philippine Islands Asset Management and Trust Group and trustee may enter into the supplemental trust indenture, will be advanced to August 22.
Likewise, the date upon which the proposed amendment will become effective or the date the consent fee is paid by the issuer pursuant to the consent solicitation, will also be advanced to August 26.
Globe appointed BPI Capital Corp. as the advisor for the exercise.
Rizza Maniego-Eala, Globe acting chief finance officer, earlier said that the consent solicitation exercise aims to amend the trust indenture of the bonds to allow Globe to maintain a higher consolidated debt-to-equity ratio of 2.5:1 from the current 2:1.
It would also help Globe align the debt-and-equity definitions with current Philippine Financial Reporting Standards, she added.
“It gives us the flexibility to be able to prepare for any future capex that we need,” Eala said, adding that transaction is expected to free up about $600 million a year on Globe’s balance sheet.
The telecom unit of Ayala Corp. closed the first six months of the year with net income of P9 billion, up 3 percent from a year ago.
Globe programmed capital expenditures of $750 million for 2016, of which it has spent $370.4 million to expand its data network in the first half.
Globe said it had 28,992 base stations, with close to 19,000 base stations for 4G, to support the service requirements of customers.
Earlier, the company said it was borrowing P7 billion from a local bank to partly finance capital expenditures this year.
“We do need financing for our capex. We have another P7 billion more to fund, but the facility is already in place,” Eala said.