MAYNILAD Water Services Inc. is eyeing a share sale next year to finance its planned capital spending.
Ramoncito Fernandez, Maynilad president, said if things go as planned, the company could be holding its initial public offering (IPO) by early next year.
Fernandez said capital expenditure for next year is around P35 billion to P40 billion from internally-generated funds, bilateral loans and other “efficient” instruments.
“We are studying other instruments that will be efficient for us in our capital raising,” Fernandez said, adding that the company may need P25 billion to P30 billion from the financial market.
Maynilad on Friday listed its P15- billion blue bond in the Philippine Dealing and Exchange Corp., helping the company secure funding for its projects for the year.
The water distribution concessionaire is looking at a capex of P22 billion to P30 billion this year, with P25 billion already secured fund raising activities – P10 billion through bilateral loans and the P15 billion blue bonds.
The blue bonds will finance Maynilad’s pipe- laying projects in Muntinlupa and Cavite; the reservoir project in Valenzuela; and the Central Manila water reclamation facility, Fernandez said.
Fernandez said the issuance of the blue bonds helped prepare Maynilad “towards completing the documentation, the requirement, the permit, etc.” of the IPO plan.
“So we will be prepared to IPO as early as next year, early part of next year. But the timing is the strategic move that we have to choose depending on market condition,” he said.
Maynilad’s blue bonds issuance is the first of its kind in the Philippines.
The five-year Series A (due 2029) and 10-year Series B (due 2034) bonds carry a coupon rate of 6.7092 percent and 7.0931 percent, respectively.
Maynilad said the bond sale was 2.47x oversubscribed from the base issue of P12 billion, enabling the company to price bonds at the tight end of its spread range.