By Beatriz Marie D. Cruz, Reporter
LISTED property developer SM Prime Holdings, Inc. (SMPH) has raised $350 million from its inaugural dollar-denominated bond issuance to fund expansion plans.
In a disclosure on Wednesday, SMPH said the offer was nearly three times oversubscribed, with demand reaching over $990 million.
The issuance is the second drawdown by wholly owned subsidiary SMPHI SG Holdings Pte. Ltd. under SM Prime’s existing $3-billion multi-issuer European Medium-Term Note (EMTN) program. The notes will be listed on the Singapore Exchange.
The notes carry a coupon rate of 4.75% and will mature in five years.
SMPH said 91% of the bonds were distributed to Asia-based investors, while 9% went to Europe, the Middle East, and Africa. By investor type, 80% was allocated to fund managers, 12% to banks, 4% to private banks, 3% to financial institutions, and 1% to insurers.
The notes were issued by SMPHI SG Holdings and guaranteed by SM Prime.
HSBC, J.P. Morgan, Standard Chartered Bank, and UBS served as joint lead managers and joint bookrunners, while BDO Capital and Chinabank Capital acted as joint domestic managers.
“Through this latest drawdown, we are able to tap the market at an opportune time to support our future projects and strategic initiatives,” SM Prime President Jeffrey C. Lim said.
“The continued interest from global investors underscores their sustained confidence in our long-term growth prospects,” he added.
In a separate note, Fitch Solutions unit CreditSights recommended SMPH’s planned issuance to investors “who are fine with just marginal spread performance but are happy to hold on to a solid quality Philippine senior dated paper from a company belonging to well-reputed conglomerate.”
“We see fair value for the new SMPH five-year bond at T+130 basis points (bp) or 4.87% yield. We expect the bond to price around 25-30 bp tighter from the IPT to land at T+120-125 bp,” it added.
SMPH plans to use proceeds to finance expansion, including 16 major redevelopments and 12 new lifestyle malls scheduled between 2026 and 2030. It is also preparing to open malls in Xiamen and Fujian, China.
This comes as the company deferred its planned $1-billion real estate investment trust listing to beyond 2026 due to unfavorable market conditions.
For the first half, SMPH posted an 11% rise in net income to P24.5 billion.
SM Prime shares on Wednesday rose by 1.27% or 30 centavos to close at P24 apiece.