Ayala Corp. raises $400 million from sale of fixed rate notes
Ayala Corporation, one of the country’s largest conglomerates, has successfully raised US$400 million after setting the terms of a US dollardenominated fixed-for-life (non-deferrable) senior perpetual issuance.
In a disclosure to the Philippine Stock Exchange, the firm said the issue, with has an aggregate principal amount of US$400 million with an annual coupon of 5.125 percent for life with no step-up.
The issuance is the first corporate fixed-for-life with no coupon step-up in Southeast Asia and the first fixed-forlife with no step-up (and reset) deal in the Philippines.
The Notes will be issued by AYC Finance Limited (a wholly-owned subsidiary of Ayala Corporation) and will be guaranteed by Ayala Corporation.
The pricing of the Notes reflected a 50-basis point compression from initial price guidance. The offering was more than five times over-subscribed, with investors’ confidence reflecting the high quality of the Ayala signature.
“This successful launch of fixed for life Notes provides us with the financial flexibility to manage our balance sheet and diversify our sources of capital,” said Ayala Corporation Chairman and CEO Jaime Augusto Zobel de Ayala said.
He added that, “we are grateful for the continued support we have received from our investors that is clearly reflected in this issuance.”
“Finding favorable conditions in a volatile credit market allows Ayala to optimize its average cost of funding while extending its debt maturity profile,” said Ayala Corporation Chief Finance Officer Jose Teodoro K. Limcaoco.
About 19 percent of the order book for the Notes was allocated to investors from the Philippines, 10 percent from Europe with the remaining 71 percent from rest of Asia.
By investor type, the split was 67 percent to fund/asset managers, 12 percent to banks, 7 percent to insurance and pension funds, and the remaining 14 percent to private banks and other investors. The transaction is expected to settle on September 13, 2017.
Hong Kong and Shanghai Banking Corporation Limited acted as Global Coordinator; and Deutsche Bank A.G., Singapore Branch, HSBC and J.P. Morgan Securities Plc acted as Joint Lead Managers with the participation of BPI Capital Corporation and Chinabank Capital Corporation as Domestic Lead Managers.