Petron to raise $500M from offshore securities


PETRON Corp., the largest oil refining and marketing company in the Philippines, is seeking to raise $500 million from the sale of undated unsubordinated capital securities.

In a disclosure to the Philippine Stock Exchange (PSE) on Friday, Petron said it had set an issue size of $500 million for the offering of US-dollar denominated senior perpetual capital securities, with an expected issue date of January 19.

Net proceeds from the issue of the securities, which will be about $498 million following the deduction of commissions, will be use for the repurchase, refinancing, and/or redemption of undated subordinated capital securities, the repayment of indebtedness and for general corporate purposes including capital expenditures.

Petron announced earlier this week that it would repurchase up to $350 million of its $750 million outstanding undated securities listed on the Stock Exchange of Hong Kong (HKEx). This came after company’s Executive Committee approved the conduct of a tender offer to holders of its outstanding $750-million, 7.5-percent capital securities.

After the repurchase of the securities, Petron would lodge an application with the Singapore Exchange Securities Trading Ltd (SGX-ST) for the listing and quotation of the securities on the SGX-ST. The price payable per $1,000 in principal amount of the securities will be $1,030 plus any accrued but unpaid distributions and any arrears of distributions, it said.

Petron said the exercise is part of its active management of its capital structure and is intended to be funded by the issuance of the new securities.


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