JG Summit secures highest credit rating for P30-B bond issue

MANILA, Philippines - Conglomerate JG Summit Holdings Inc. of tycoon John Gokongwei Jr. has secured the highest credit score for its planned P30-billion bond sale.

In a disclosure, the investment holdings firm said local credit rater Philippine Rating Services Corp. (PhilRatings) assigned the PRS Aaa score for its long-term bonds.

“Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong,” said PhilRatings, which also retained the PRS Aaa rating for JG Summit’s outstanding P9 billion bonds.

In November, the company filed a registration statement with the Securities and Exchange Commission in line with its plan to issue P20 billion in retail bonds, with an oversubscription option of up to P10 billion.

Fresh capital from the bond sale will partially finance the company’s acquisition of Manila Electric Co. shares and for general corporate purposes.

PhilRatings said the credit score reflect JG Summit’s strong liquidity, sound capitalization, solid market position of its core businesses and good management.

“The ratings also consider the continued positive prospects of the domestic economy, which is expected to benefit the industries of JG Summit’s core businesses,” PhilRatings said.

JG Summit, one of the largest and most diversified conglomerates in the Philippines, is into budget airline (Cebu Pacific), property (Robinsons Land Corp.), banking (Robinsons Bank Corp.), petrochemicals (JG Summit Petrochemicals Corp.), and snacks and beverage (Universal Robina Corp.).

The conglomerate’s strategic focus is to establish and maintain leadership across all of its businesses; maintain the strength and diversity of its portfolio; continue to invest for sustainable growth; and pursue disciplined growth into selected international markets.

“Going forward, cash from operations will be sufficient for working capital, loan repayments (including the proposed bond issue), capital expenditures and payment of dividends,” PhilRatings said.