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By Likha Cuevas-Miel, Reporter
First Philippine Holdings Corp. plans to
refinance its debts maturing next year to take advantage of
relatively lower interest rates, its CEO announced Tuesday on the
sidelines of an investors’ briefing.
Elpidio L. Ibañez, president and FPHC chief
operating officer, said the company plans to raise fresh funds to
refinance its debt of $70 million maturing next year [as] “these
debts were obtained when the rates were very high.”
How the company will go about raising funds will
depend on “what the market wants; we’ll see [whether we can
borrow]… if the market stabilizes and if rates are attractive,”
Ibañez said.
First Philippine Holdings is the parent firm of
the Manila Electric Co., First Philippine Infrastructure Inc., First
Philippine Infrastructure Development Corp. and Manila North
Tollways Corporation
From April 10 until 17, it will offer and
subsequently list up to 50 million Series “B” perpetual
preferred shares with a par value of P100 each, consisting of 30
million shares that will be sold to the public. The balance of 20
million preferred shares shall cover for the over-allotment option
priced at P100 each, which may be exercised on or after the dividend
rate setting date of April 4.
According to Eduardo Francisco, BDO Capital and
Investment Corp. president, the indicative dividend rate based on
Tuesday’s PDSTF (Philippine Dealing System Trading Fixed) rate is
6.80 percent + 1.75 percent, which translates to 8.55 percent for
corporate net rate and 7.695 percent for individual net rate.
FPHC is expected to raise about P3 billion in
gross proceeds, P1 billion of which would go to Meralco shares and
investments in several of its subsidiaries, including FPII, FPIDC
and MNTC.
The Lopez-led firm is also investing in First
Philec, its manufacturing business that needs about $18 million for
wafer slicing for solar power panels, and other projects being
developed in its joint venture with Sunpower Philippines
Manufacturing Ltd., an affiliate of US-based Sunpower Corp.
Ibañez said First Philec would act as a
subcotractor for Sunpower, and the investment is expected to bring
in at least 18 percent rate of return.
From the total proceeds, FPHC has earmarked P1.5
billion to pay its outstanding obligations comprising fixed rate
notes worth $52 million, long-term debt with Asia Infrastructure
Mezzanine Capital Fund and $17.9-million debt with Standard Bank
Asia Ltd.
The balance of the estimated proceeds of the
preferred shares estimated at P443 million will be used to finance
capital and operating requirements and other general corporate
expenses.
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