Ayala Land starts P6-billion bond offer
MANILA - Property developer Ayala Land Inc. (ALI) on Monday launched its P6-billion bond offer, with tenors of seven and 20 years, the longest for a domestic corporate bond in the country.
The debt papers carry a coupon rate of 4.625 percent for the seven-year bond and 6 percent for the 20-year paper.
The public offer started on Monday and will continue throughout the week. Issue and listing data for the bonds is scheduled on October 10.
BPI Capital Corp., BDO Capital and Investment Corp. and First Metro Investment Corp. are the joint lead underwriters and bookrunners.
The said offer is part of the P21-billion bond float approved by regulators in June. The first tranche of which were already issued by ALI in July.
Jaime Ysmael, the company’s chief finance officer, earlier said the proceeds of the P6-billion bond float will be used for its units Avida Land Corp. and Amaia Land, or about P3 billion for each company.
“This is the first time non-listed companies will tap the debt capital market. That is why they are undergoing a very stringent process [of approval by the Securities and Exchange Commission],” Ysmael said.
The company, the country’s second-largest property developer next to the combined SM Group, has a capital expenditure target of about P65.5 billion for the year.
Ysmael said as of the first half of the year, the company spent P23.2 billion and the bulk of the company’s spending will be made toward the end of the year.
“Borrowings will definitely be part of the equation on our capital expenditures,” Ysmael said, adding that Ayala Land will raise money for its units, especially those that cannot raise the funds on its own due to lack of track record.
In July ALI raised P15 billion worth of 10.6-year bonds, proceeds of which will be primarily be used to fund its several townships nationwide and to acquire several properties to improve its land bank.
Some P4 billion will be used to jump start its several township projects like Vertis North in Quezon City, Arca South or the former FTI property in Taguig City, Alvierra in Pampanga and Altaraza in Bulacan.
About P1 billion will be allotted for the development of various residential projects such as Park Terraces, Garden Towers and subdivision projects in Nuvali in Laguna like Santierra, Elaro and Luscara, the company said in its regulatory filing. A P300-million Seda hotel will also rise in Nuvali, it said.
Another P900 million will be spent for the construction of various leasing assets including additional buildings for business process outsourcing offices in UP-Ayala Technohub and the construction of UP Town Center both in Diliman, Quezon City, the expansion of Ayala Center in Cebu and Abreeza in Davao.
Ayala Land posted a P5.62-billion net income for the first half of the year, an increase of 30 percent from last year’s P4.33 billion.