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Tuesday, May 6, 2014

Ayala unit raises $300M from bond sale

A unit of Ayala Corp (AC) has completed the sale of bonds that can be exchanged for shares in the conglomerate's property arm.

In a disclosure to the Philippine Stock Exchange, AC said AYC Finance Ltd listed the $300 million worth of bonds due 2019 in the Singapore Exchange on Monday.

The bonds, carrying an interest rate of 0.5 percent per year, will be exchangeable to common shares of Ayala Land Inc (ALI) at P36.48 per share starting June 11 until the tenth day prior to its May 2, 2019 maturity date.

The issuance will not result in a dilution of ownership in ALI because the shares to be exchanged will come from the conglomerate's stake in the real estate firm.

AC’s holdings in the property company will fall to 46.5 percent from 49 percent if all bondholders will exchange their debt for shares in ALI.

The offering is the first equity-linked international issuance by a Philippine issuer in the past two years. It has also achieved the lowest cost of financing across Asia ex-Japan in 2014.

The Ayala group intends to use proceeds from the issuance for general corporate purposes and investments, particularly those at the parent level.

AC's consolidated net income jumped 22 percent to P12.8 billion last year, faster than the 14 percent expansion to P10.50 billion in 2012, on the strength of its real estate and banking businesses.

AC also has interests in Bank of the Philippine Islands, Globe Telecom, Manila Water, Integrated Micro-Electronics Inc, and business process outsourcing firm LiveIt.

- Interaksyon

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