San Miguel Corp. looks to raise as much as $3 billion through a medium-term note program it has established.
The company will then raise $500 million through perpetual securities out of the program, and which will be issued and registered with the Singapore Exchange.
“It will be available for a medium term and will allow the company to tap the financial market for funding through the issuance of securities, including but not limited to corporate notes, bonds, and perpetual securities and other similar instruments at different currencies, whether considered debt or equity for accounting purposes,” the company said.
San Miguel said the medium term lending plan “will give the company ready access to funding and will give the company the flexibility to fund its contemplated investments and projects such as the Metro Rail Transit 7 construction, the Bulacan airport, as well as the refinancing of its existing obligations and for other general corporate purposes.”
Meanwhile, SMC unit San Miguel Food and Beverage Inc. (SMFB) eyes to raise P15 billion through a bond issuance, the proceeds of which will be used for the redemption of the company’s Series 2 Preferred Shares of the same amount, issued five years ago.
The company said local credit rating firm Philippine Ratings Services Corp., (Philratings) rated the bonds a PRS Aaa — the highest quality with minimal credit risk.
This means the company has an “extremely strong” capacity to meet its financial commitment on the obligation.
“PhilRatings took into account the following major rating factors in assigning the rating and the Outlook for SMFB’s proposed bonds: strong brand equity and leading market position of SMFB’s core businesses; realized synergies as part of the San Miguel Group and as a result of the consolidation of the food and beverage business under SMFB, coupled with the company’s highly-experienced management team; continued positive outlook for the economy which is expected to benefit the food and beverage industry; the Company’s conservative financial position considering the capital intensive nature of its businesses; and its strong profitability performance and healthy cash flow generation,” the company said.
“PhilRatings also positively notes that SMFB shares common directors and executive officers with other SMC-owned companies, reflecting the company’s strategic importance to the entire Group,” SMFB added.