IN consultation with China Banking Corp., its issue manager and lead underwriter, Sta. Lucia Land Inc. (SLI) has set the rates for its maiden peso-denominated retail bonds that could raise up to P5 billion for loan refinancing and land banking.
In a disclosure to the Philippine Stock Exchange on Thursday, the publicly listed commercial-residential property developer said it has set the annual interest rate for its 3-year Series A bonds at 6.7284 percent, and for its 5.25-year bonds, at 6.715 percent.
Marking SLI’s maiden debt capital market transaction, the Securities and Exchange Commission on Wednesday cleared SLI’s registration of the bonds.
The bonds issue will be composed of P3 billion base issue and another P2 billion for the overallotment option. It is also divided into two series: Series A bonds maturing in three years, and Series B bonds due 5 years and three months from the issue date.
China Bank’s co-lead underwriters are Amalgamated Investment Bancorporation and BDO Capital & Investment Corp.
The peso-denominated unsecured fixed rate bonds were rated AA+ by the Credit Rating and Investor Services Philippines Inc., according to SLI.
Net proceeds of P4.89 billion after fees and taxes will go to refinancing of existing secured loans (P3.254 billion), capital expenditures for land banking and ongoing projects for 2015 and 2016 (P1.381 billion), and general corporate purposes (P262 million).
Without the exercise of the overallotment option, net proceeds will amount to P2.935 billion, to be used entirely for the refinancing of secured loans.
As of end-September, the company has maturing loans worth P3.254 billion due late 2015 to 2018. The loans are from BDO Unibank, Inc. (P1.036 billion), China Bank (P1.5 billion), Rizal Commercial Banking Corp. (P323.5 million), Asia United Bank (P250 million), and Malayan Bank (P144.5 billion).
For the land banking initiatives, Sta. Lucia said the bond issue will partly fund the purchase of some 223 hectares of lots, worth P2.877 billion, for future projects.
The target land parcels are located in Quezon City (40 hectares), Rizal (18.1 hectares), Batangas (98 hectares), Laguna (10.7 hectares), Iloilo (33.2 hectares), and Davao (23 hectares).
With the land blocs under various acquisition stages, the company said earlier it aims to broaden its reach beyond Metro Manila, where the SLI is very much visible, having more or less 40 ongoing masterplanned subdivision projects within and near Metro Manila.
Incorporated in 1996 and formerly a mining company, Sta. Lucia is engaged in real estate development, mainly of horizontal and vertical residential projects, as well as commercial malls.