December 20, 2024 | 12:00am
MANILA, Philippines — SM Prime Holdings Inc., the integrated property developer of the Sy family, targets to raise another P25 billion from a planned bond offering to fund its upcoming investments and refinance debt.
SM Prime is looking to issue P20-billion worth of bonds, with an oversubscription option of up to P5 billion.
Proceeds of the issuance will be used for the company’s debt refinancing and capital expenditures.
The proposed issue represents the second tranche of the company’s shelf registration debt securities program of up to P100 billion.
The company raised P25 billion from the first tranche through an oversubscribed bond offering in June.
Philippine Rating Services Corp. (PhilRatings) has assigned an issue credit rating of PRS Aaa to the planned bond issue.
PhilRatings also maintained an issue rating of PRS Aaa for SM Prime’s outstanding bonds amounting to P137.83 billion.
Further, a Stable outlook has been assigned for the proposed and outstanding bonds.
PRS Aaa is the highest rating assigned by PhilRatings, denoting that such obligations are of the highest quality with minimal credit risk and that the issuing company’s capacity to meet its financial commitment on the obligations is extremely strong.
PhilRatings said the assigned issue ratings took into consideration SM Prime’s sustained recovery in profitability, strong liquidity and sound capitalization.
It also considered the company’s well-experienced shareholders, seasoned management as well as solid brand equity.
“SM Prime has established a solid brand equity, anchored on its long-established operations in and out of the country,” PhilRatings said.
“The company’s market position is further strengthened by its diversified portfolio, as well as its several ongoing projects. Additionally, with a land bank of approximately 2,374 hectares, the company is well-positioned for continued development over the next five to seven years,” it said.
SM Prime is looking to spend up to P110 billion for its capital expenditures next year.
The company is focusing its future mall expansion in northern Luzon, Visayas and progressive cities in Mindanao.
PhilRatings said that SM Prime’s bottom line is seen to steadily grow.
“This will be attributed to the revenues from same-store rent plus contributions of new malls, offices, hotels and expansions, as well as sales of ready-for-occupancy units and new launches of mid-rise and horizontal projects,” it said.
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