Cemex gets $280-million loan facility from BDO

CEMEX HOLDINGS Philippines, Inc. has secured a loan facility from BDO Unibank, Inc. for the peso equivalent of $280 million to refinance an outstanding obligation barely seven months after joining the equities market through a P25.13-billion initial public offering.

In a disclosure to the Philippine Stock Exchange, the cement producer said it signed on Wednesday a senior unsecured peso term loan facility agreement with the country’s biggest lender to refinance its long-term loan with New Sunward Holding B.V.

The loan will have a tenor of seven years from the date of the initial drawdown. It consists of tranches carrying a fixed rate and a floating rate.

“We are confident that this endeavor underscores the strength of our operations, as we seek ways to further solidify our business position and improve our capital structure,” Cemex President and Chief Executive Officer Pedro Jose Palomino said in the disclosure.

The company debuted on the stock exchange in mid-July 2016. The listing was the largest since Robinsons Retail Holdings, Inc. raised P28.11 billion in 2013 and SM Investments Corp. generated P26.25 billion in 2005.

Cemex had earmarked proceeds from its P25.13-billion IPO to settle short-term debts for the acquisition of its operating businesses and to subsequently free up capacity to expand its Solid Plant in Antipolo City.

The company is investing $300 million until 2019 to double the capacity of Solid Plant to 3.4 million from 1.9 million metric tons (MT) and bring its total capacity to 7.2 million from 5.7 million MT.

As of the end of September 2016, Cemex had P22.25 billion in total liabilities, including P5.90 billion maturing within a year. The company had P51.01 billion in total assets, P6.55 billion of which counted as current, plus P1.4 billion in retained earnings.

Cemex mandated BDO Capital & Investment Corp. as the sole structuring agent and underwriter for the refinancing loan. It tapped the same investment bank as the sole domestic underwriter of its IPO last year.

“This deal is a testament to our continued solid support of CHP’s business and positive long-term outlook for CHP’s prospects,” BDO Capital President Eduardo V. Francisco said in the disclosure, referring to Cemex by its ticker symbol.

“We believe that the financing structure that we’ve put in place further strengthens the financial position of CHP,” Mr. Francisco added.

The indirect subsidiary of CEMEX S. A. B. de C.V., whose shares trade on the Mexican Stock Exchange as well as the New York Stock Exchange, produces and directly markets cement, ready- mix concrete, clinker and other related products in the Philippines.

Cemex, through its cement manufacturing subsidiaries, has operated in the country for more than 17 years now under the brands APO, Island and Rizal, among others.

In the first nine months of 2016, the company booked P1.40 billion in net income attributable to the parent from gross revenue of P19.25 billion. Its stock price rose 10 centavos or 0.89% to P11.30 on Wednesday. —