Tycoon Henry Sy’s SM Group is allocating a combined 2013 capital spending of P60 billion for all the property businesses it intends to merge within this year.
“Right now, what we have are the sum of parts of all the individual property companies [we will merge], and this year the total is about P60 billion,” Jeffrey Lim, SM Development Corp. president, told reporters after the SM Prime Holdings Inc. stockholders meeting held on Wednesday.
“For the next three years, we still have to determine what would be the final capex plan,” he added.
SM Prime President Hans Sy also said that the group intends to establish an integrated development plan for the enlarged SM mixed-use real-estate company first before anything else.
“Actually, we would still continue as to what we have right now but within six months to a year, we should be able to reprogram everything and come up with an integrated development plan,” Sy said.
Lim, who also sits as SM Prime chief financial officer, added that the company is currently evaluating the market as to when it will do certain fund-raising for the consolidated property firm.
“That will be an option for us, but we have to sit down first and do an integrated expansion program for the enlarged entity. That’s an option for us. We can also tap the debt market, because gearing will be low in the large entity,” Lim said.
On Wednesday, shareholders of SM Prime already approved the merger between the company and SM Land Inc., which will pave the way for the consolidation of the property-related businesses of the SM Group of Companies.
At the firm’s special stockholders’ meeting, its shareholders approved the amendment of the company’s articles of incorporation, which will reflect an increase in the authorized capital stock of the company to P40 billion from P20 billion.
Also included in the amended articles is the change in the company’s primary purpose to a mixed-use real property developer.
“We will submit the documents now to the Securities and Exchange Commission for approval, and then after that we have to sit down with all our business unit heads to put up a integrated development plant for the enlarged group,” Lim said.
Meanwhile, Jose Sio, chief financial officer of SM Investments Corp., said that the group is looking to conclude the first half of this year with a 14-percent to 15-percent bottomline growth.
SMIC, which is the listed holding company of the SM Group, is eyeing 15-percent to17-percent growth this year after concluding first quarter of 2013 with a 22-percent growth in its profit.