Vista Land raises $350 M from bond sale

Vista Land & Lifescapes, Inc., the largest homebuilder and one of the leading integrated property developers in the Philippines, has successfully priced US$350 million worth of bonds through wholly owned subsidiary VLL International, Inc.

In a disclosure to the Philippine Stock Exchange, Vista Land said the price was set after it went on a roadshow to meet with existing and potential bond investors.

“The new bond issue, coupled with a liability management transaction, allows Vista Land to reduce our short-term refinancing risk, extend our maturity duration and realize interest expense savings,” said Vista Land President and CEO Manuel Paolo Villar.

He added that, “it also provides us an opportunity to continue diversifying our sources of funding, ensuring we continue to build key relationships not only with our investors onshore, but also with investors from Europe and Asia.

On November 20, Vista Land announced a new 7-year bond that has a call option starting on the fourth year with an indicative price guidance of around 6.125 percent.

Strong response from investors enabled Vista Land to further tighten the pricing of the bonds to 5.750 percent, or 37.5 bps tighter than their guidance, despite some market volatility. This is the lowest coupon achieved by the company on the offshore bond markets.

“The ability of Vista Land to price much tighter is a testament to the credit profile of the company, and the confidence it enjoys from offshore investors who continue to support their issuances,” said HSBC President and CEO Wick Veloso.

The final orderbook reached US$1.7 billion – this meant the transaction was almost five times oversubscribed. It is also the largest size raised by Vista Land on a primary issuance.

The bonds are expected to be issued on November 28. The proceeds from the issuance will be used primarily for refinancing.

On November 10, the company announced a liability management exercise for the tender offer of its outstanding US$51.8 million 6.750 percent bonds due 2018 and US$180.8 million 7.450 percent bonds due 2019.

DBS Bank Ltd. and HSBC were Joint Lead Managers and Bookrunners for the new bonds, and are also Joint Dealer Managers for the tender offer exercise. China Bank Capital Corporation also acted as Domestic Manager for the new bonds.