SM Prime expects to raise P25 billion from bond issue

MANILA, Philippines — Sy-led integrated property developer SM Prime Holdings Inc. is gearing up to raise as much as P25 billion from a proposed bond offering to fuel its expansion.

SM Prime said it has submitted to the Securities and Exchange Commission (SEC) a registration statement for its application for the shelf registration of debt securities amounting to P100 billion.

The application to issue shelf-registered bond in the aggregate amount of P100 billion was approved by the company’s board of directors last month.

SM Prime is looking at an initial offering of P20 billion worth of bonds, with an oversubscription option of up to P5 billion.

The offering consists of three-year Series V bonds due in 2027, five-year Series W bonds due in 2029 and seven-year Series X bonds due 2031.

SM Prime said the first tranche of its proposed three-year debt securities program of up to P100 billion has been assigned a PRS Aaa rating by the Philippine Rating Services Corp. (PhilRatings).

PRS Aaa is the highest rating assigned by PhilRatings. Such obligations are of the highest quality with minimal credit risk and that the issuing company’s capacity to meet its financial commitment on the obligations is extremely strong.

PhilRatings assigned a stable outlook for the ratings of the proposed and outstanding bonds.

SM Prime’s proposed offering will mark its return to the bond market.

The company in 2020 filed with the SEC a shelf registration covering P100 billion worth of bonds to finance its pipeline of projects and other general funding needs.

The fifth and final tranche of the bond program was listed by SM Prime at the Philippine Dealing & Exchange Corp. in May last year.

The SEC’s shelf registration facility is an option for issuers to register and sell under the same regulatory documents securities, which they do not intend to sell right away.

For 2024, SM Prime earlier said it is eyeing P100 billion for its capital expenditure program.