Gearing for its next major fundraising activity, SM Prime Holdings, Inc. (SMPH), one of Southeast Asia’s largest property developers, already set the rates for its latest bond issuance, which will give the company a P20-billion war chest as it expands its mall footprint across the country.
 
A prospectus filed with the Securities and Exchange Commission (SEC) on Wednesday showed the company is going to issue P15 billion worth of Fixed Rate Peso Retail Bonds, with an overallotment option of up to P5 billion.
 
The bonds will be issued into two series — Series D with maturity of 5.25 years, which carry an interest rate of 4.51 percent per annum, and Series E with maturity of 10 years, carrying an interest rates of 4.79 percent per annum.
 
“The retail bond to be issued by SM Prime will largely support funding for our mall expansion programs in the coming years.  This is a testament to management’s confidence that the economic growth of the Philippines will be sustained over the medium term and will eventually have a positive impact on the provinces as growth spreads to these areas.” SM Prime President Hans T. Sy said in the company’s disclosure to the Philippine Stock Exchange on Thursday.
 
By the end of 2015, SM Prime will increase its number of malls to 55 in the Philippines with an equivalent mall footprint of 7.3 million square meter in terms of gross floor area (GFA).
 
Next year, SM Prime will open six new malls and expand two existing mall. Combined, the additional mall space is 571,631 square meters.
 
Most of the proceeds will be disbursed in the first half of 2016 for the construction and completion of 11 malls.
 
As of now, the giant property developer is working towards the 100-percent completion of SM City Seaside Cebu, SM City Cabanatuan, and SM Center Sangandaan.
 
Some of the other SM malls that will be funded by the proceeds from the offer include those that are in San Jose Del Monte in Rizal, Commonwealth in Quezon City, Tuguegarao, Puerto Princesa, Cagayan De Oro.
 
The company was supposed to start the offering on Wednesday until November 13 but it hasn’t got the approval from the SEC yet. November 25 was the target issue date for the bonds.