Ayala Land Inc., the second-biggest builder, has successfully raised P7 billion from the issuance of retail bonds priced at 4.75 percent a year.
Total demand for the bonds reached P11 billion on strong market liquidity, according to one of the underwriters handling the transaction.
Sources said the 4.75 percent per annum interest rate for the bonds maturing in 2025 was at the low end of the price range of 4.75 percent to 4.83 percent.
The offering period ran from April 13 to April 15, with investors swarming on the P7-billion bond issue. Ayala Land will list the bonds with Philippine Dealing & Exchange Corp. on April 25.
The bond issue was the second tranche of the fixed rate series under the company’s P50-billion debt securities program approved by the Securities and Exchange Commission.
The first tranche, worth P8 billion issued only last month, was oversubscribed by 3.7 times at P29 billion, prompting the property firm to issue another tranche in less than one month.
Ayala Land hired BDO Capital & Investments Corp., BPI Capital Corp., China Bank Capital Corp. and First Metro Investments Corp. as joint lead underwriters and book runners for the P7-billion bond offering, and East West Banking Corp. and PNB Capital and Investments Corp. as co-lead managers.
Ayala Land plans to use proceeds from the offering to finance the company’s corporate requirements and capital expenditures, including the redevelopment of the Intercontinental Hotel area along Ayala Ave. into a transport hub with retail and office component, the construction of a high-end office project and retail mall in Ayala Triangle in Makati and the construction of Cloverleaf Mall in Balintawak, Quezon City.
Ayala Land reported a net income of P17.6 billion in 2015, up 19 percent from P14.8 billion in 2014.
Consolidated revenues reached P107.2 billion, 13 percent higher than P95.2 billion in the previous year.
The company attributed the revenue growth to the sustained performance of the property development and leasing businesses, and improved margins across product lines.
Ayala Land over the next five years plans to increase its net income annually by 20 percent to reach P40 billion by 2020.
It plans to achieve the target by aggressively rolling out residential projects, while increasing investments in recurring businesses and optimizing its landbank.
The property firm also plans to maintain a capital spending of P80 billion to P90 billion over the next five years.
