SM Investments Corp. has successfully raised P15 billion in its latest bond sale.
The company listed the bonds with at the Philippine Dealing and Exchange Corp. (PDEx) last week.
“Investors snapped up the bonds after the offering closed on February 11, 2022, a strong testament to investor confidence on SM’s credit standing,” it said.
The retail bond sale was 3.7 times over-subscribed with orders reaching P55 billion, and is SM Investments’ biggest issue since 2016.
“The hefty investor appetite for these securities was on the back of volatility around local interest rate sentiment with expectations of the US Federal Reserve hiking rates,” said Frederic DyBuncio, SM Investments president.
“This exercise mirrors investor confidence on SM’s credit quality and overall prospects for growth while increasing our funding flexibility and enhancing capital efficiency,” he added.
The bond sale has an initial offer of P10 billion with another P5 billion covering the oversubscription option, divided into a three-year and five-year tenors. The bonds carry a coupon rate of 3.5915 percent for the three-year bonds due 2025, assigned the I series, and 4.7713 percent for the five-year bonds due 2027, assigned the J series.
The offering, which started on Feb. 7, 2022, forms part of SM Investments’ second tranche of the P30 billion debt securities program registered with the Securities and Exchange Commission under a shelf registration.
SM Investments said the bonds’ proceeds will be used to refinance debt that funded capital expenditure.
The bonds have been rated PRS Aaa, with stable outlook by PhilRatings, the highest quality rating with minimal credit risk.