Ayala Land plans to raise up to P25 billion

AYALA LAND, Inc. (ALI) plans to raise up to P25 billion from a combination of retail bonds, loans, and qualified buyer notes this year to partially finance its aggressive spending program and to refinance existing debt.

In a disclosure to the stock exchange on Wednesday, ALI said its board of directors approved the plan to raise as much as P20 billion through retail bonds and bilateral term loans, which will be used to fund the company’s P110.8- billion capital expenditure budget this year.

The retail bonds will be issued from the P50- billion shelf registration program the company has with the Securities and Exchange Commission since March 2016, which will then be listed in the Philippine Dealing and Exchange Corp. (PDEx). In an earlier interview, ALI Chief Finance Office Augusto Cesar D. Bengzon said the company has P18 billion left in this debt securities program.

Meanwhile, the listed property firm’s board has also approved the issuance of qualified buyer notes to raise up to P5 billion for the refinancing of its short-term loans.

The company previously raised P3.1 billion in short-dated notes, which were also listed at the PDEx, last November 2017 to finance its short-term debt.

ALI has committed to spend P110.8 billion in capital expenditures this year, 21% higher than its actual spending of P91.4 billion in 2017, to support the demand for more residential properties in the country. Around 43% of the capex or P47.4 billion will be allotted for residential projects, 17% or P18.7 billion for mall projects, 12% or P14 billion for land acquisitions.

The remaining portion allocated for the hospitality business and the development of existing estates.

The accelerated capex comes alongside the plan to launch P125 billion worth of projects this year, against the P88 billion worth of projects unveiled in 2017.

MALAYSIAN DEVELOPER

Meanwhile, ALI said it has also completed the unconditional mandatory take-over offer made by its wholly owned subsidiary, Regent Wide Investments Ltd. to minority shareholders of Malaysian developer MCT Bhd.

The company undertook the mandatory take- over offer after it increased its stake in MCT to 50.19% in January, adding 17.24% to its original share. With the transaction, ALI was able to further raise its stake in the company to 72.31%, after taking over some 295.28 million shares held by minority shareholders, or 22.12% of MCT’s total outstanding shares.

ALI initially purchased a 9.16% interest in MCT back in April 2015, which was the company’s first investment in Southeast Asia. The company has since been propping up its stake in MCT, which allows ALI to take advantage of the growing real estate sector in Malaysia.

MCT was founded in 1999 as a construction company, specializing in mixed-use projects that include retail, office, hotel, and mid-range to affordable to residential properties.

ALI’s attributable profit grew 21% to P25.3 billion in 2017, driven by the 14% increase in revenues to P122 billion amid strong demand for residential projects in the country.

Shares in ALI lost a peso or 2.17% to finish at P45 apiece at the stock exchange on Wednesday. —