SM PRIME Holdings, Inc., the property holding firm of Henry Sy, Sr., plans to raise as much as P20 billion in its return to the bond market.
 
SM Prime secured board approval to issue fixed-rate retail bonds of up to P15 billion with an oversubscription of up to P5 billion, the integrated property developer told the stock exchange.
 
The proposed debt sale will mature in 5.25 years and 10 years.
 
This marks SM Prime’s return to the bond market since generating P20 billion from its maiden issuance in August last year.
 
SM Prime Chief Executive Officer Jeffrey C. Lim said last month the company may raise roughly P30 billion from two debt issuances until the first semester of 2016 to finance capital expenditure requirements.
 
Mr. Lim had said the company was considering raising funds before the Federal Reserve starts raising interest rates.
 
At the end of its two-day policy meeting, the U.S. central bank decided to defer the first interest rate hike in nearly a decade.
 
SM Prime is on the second year of a five-year program that entails a capital spending budget of P400 billion to beef up its businesses that will double earnings by 2018. The company is allocating P72.3 billion for capex this year.
 
SM Prime nearly doubled its net income to P18.7 billion in the first half from P9.8 billion a year ago, buoyed by an extraordinary gain and a double-digit growth in its core businesses.
 
Excluding one-time trading gains on the sale of marketable securities, recurring net income was up 15% to P11.2 billion year-on-year.
 
SM Prime is part of SM Investments Corp., which has core businesses in retail, banking and real estate. The family also has interests in gaming, geothermal energy and infrastructure.