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SM Prime sets rate for P10-billion seven-year bond offer at 5.0994%

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SM PRIME Holdings, Inc. has priced its its seven-year P10-billion retail bond Series O, which is the third tranche of its P100-billion shelf-registered fixed-rate papers, at 5.0994% per annum, it said on Tuesday.

The offer comprises a P5-billion principal offer, with an oversubscription option of up to P5 billion.

The bonds will be offered until Nov. 8, after receiving the permit to sell from the Securities and Exchange Commission, while its issuance is slated for Nov. 15.

“The proceeds of this latest retail bond will be used to pursue expansion opportunities across business segments, which will help sustain the company’s growth,” SM Prime Chief Finance Officer John Nai Peng C. Ong said in a statement on Tuesday.

SM Prime assigned BDO Capital & Investment Corp. and China Bank Capital Corp. as the bonds’ joint issue managers. They will be joined by BPI Capital Corp., East West Banking Corp., First Metro Investment Corp., SB Capital Investment Corp., and RCBC Capital Investment Corp. as joint lead underwriters.

SM Prime’s seven-year Series O bond received a PRS Aaa rating from the Philippine Rating Services Corp., the highest issued by the debt watcher, which is “given to long-term debt securities with the smallest degree of investment risk.”

The rating also signifies the company’s capability to meet its financial obligations.

The P10-billion Series O bonds are part of the company’s P100-billion shelf-registered fixed-rate bonds.

The first tranche of the papers, which was made up of P15-billion fixed-rate bonds with five-year (4.8643% per annum) and seven-year (5.0583% per annum) terms, was issued in March last year.

Meanwhile, the second tranche with P10-billion fixed-rate bonds with terms of two-and-a-half years (2.4565% per annum) and five-year (3.8547% per annum) was issued in February.

Shares of SM Prime at the stock market improved by 1.21% or 40 centavos to close at P33.50 apiece on Tuesday. — K.C.G. Valmonte