Listed Manila Water Co. Inc. has raised $500 million from its issuance of sustainability bonds overseas to fund its capital spending.
In a disclosure on Friday, the Ayala-led utility said proceeds from the offer would bankroll projects aimed at improving water and wastewater services within its East Zone concession area.
“The successful sustainability bond issuance will support financing of important water and wastewater infrastructure projects in our communities in the East Zone, which have been agreed with our regulators and which will provide stable and predictable cashflows,” Manila Water Chief Finance Officer and Treasurer Ma. Cecilia Cruzabra said.
“The issuance will also allow us to refinance our maturing obligations, further diversify our funding sources and lengthen our maturity profile,” she added.
The US dollar-denominated Reg-S 10 noncall five-year notes have a fixed coupon of 4.375 percent and issued at 99.002, payable semiannually.
The notes, the company said, were priced at 4.50 percent, 25 basis points tighter than its initial price guidance.
Manila Water booked orders worth nearly $1.96 billion from 85 quality institutional investors. These mostly came from Asia (79 percent) and the rest from Europe, Middle East and Africa (21 percent).
“As a member of the Ayala Group of Companies, we are very grateful for the strong market response which reflects the investors’ confidence in Manila Water’s fundamental strength and stability as a leading Asian player in the water and wastewater industry,” Manila Water President Jose Rene Almendras said.
“The issuance of this sustainability bond is fully aligned with our commitment to create shared value towards achieving the targets of the UN (United Nations) Sustainable
Development Goals (SDG), especially SDG 6, which focuses on clean water and sanitation,” he added.
The offering is Manila Water’s first in the international capital markets. It is also the single largest green, social or sustainability bond issued by a listed private water utility in Asia and the first Association of Southeast Asian Nations (Asean) Sustainability Bond by a corporate issuer from the Philippines.
BPI Capital Corp.; Citigroup Global Markets Singapore Pte. Ltd.; Credit Suisse (Singapore) Ltd.; Hongkong and Shanghai Banking Corp. Ltd., Singapore branch; Mizuho Securities (Singapore) Pte. Ltd.; and UBS AG Singapore branch were the transaction’s joint lead managers and bookrunners.
Manila Water shares fell by 18 centavos or 1.39 percent to close at P12.76 each on Friday.