SM Investments issues $400-M of 2017 bonds


Posted at Oct 07 2010 01:33 PM | Updated as of Oct 07 2010 09:38 PM

MANILA, Philippines - SM Investments Corp. (SMIC) said on Thursday it would issue $400 million of new 2017 bonds, including $213.7 million in an exchange for shorter-dated bonds to lengthen its maturity profile.

The company, owned by the country's richest man Henry Sy, raised $186.3 million from the sale leg of the deal.

SMIC said in a statement it had swapped $82.9 million of its 2013 bonds and $130.8 million of it 2014 bonds for the new dollar bonds which will have a coupon rate of 5.5% per annum.

The company said the sale of new bonds was 6.7 times oversubscribed, with 27% bought by onshore investors, 64% by Asian investors, and 9% by European investors.

Settlement of the debt swap and sale is on October 13.

"This transaction is a liability management exercise for SMIC which lengthens the duration of its existing debt while taking advantage of favourable market conditions," the company said.

It was the first bond exchange deal to be carried out by a Philippine company, with the 2017 bonds carrying the lowest coupon rate ever for a Philippine corporate bond issue of any maturity, SMIC said.

The government recently completed a $3.2 billion debt exchange and sale programme.

Citigroup and HSBC were joint dealer managers and joint bookrunners for the SMIC transaction, with BDO Capital and Investment Corp. as joint dealer manager and co-manager.

Shares in SMIC, which has interests in shopping malls, banking and property development, closed up 1.1% at P535 apiece in a market that was also up 1.1%.