SM Prime Holdings, Inc. plans to invest $3.4 billion for its capital expenditures (capex) for 2014 to 2015 as it moves forward with the consolidation of the Sy family’s real estate businesses.

A presentation attached to a disclosure on Friday showed that SM Prime expects the completion of the its merger with SM Land, Inc. in early 2014 after it bagged regulatory approval for the merger.

SM Prime bared its strategy moving forward which involves land acquisition; establishment of more world-class malls; optimization of existing properties; continuation of aggressive rollout of business process outsourcing development; as well as maintenance of strong balance sheet, prudential risk and capital management, and good governance.

“To support this strategy, capex plans will be accelerated to pursue highly attractive opportunities in the market,” the presentation read.

It further showed that the company has earmarked a $1.5-billion capex for 2014 and $1.9 billion for 2015.

“We plan to fund our $3.4-billion capex requirement through an optimal combination of internally generated cash, debt and equity,” the presentation read.

SM Prime had set a capex of $800 million in 2012 and $1.4 billion this year.

The Securities and Exchange Commission last month approved the merger of SM Prime and SM Land which will leave the former as the surviving entity.

At the same time, the regulator cleared SM Prime’s increase in authorized capital stock to P40 billion from P20 billion and issuance of common shares for acquisition of real estate companies and properties held by SM Investments Corp. (SMIC) through share swap.

The merger was approved after SM Land — a privately held company of the Sy family — acquired condominium builder SM Development Corp. and leisure property developer Highlands Prime, Inc.

The group had said in May that SM Prime would acquire property assets, hotels, resorts and convention centers owned by SMIC or the Sy family through share-swap transactions.

Once consolidation is completed, SM Prime is expected to become the biggest property firm in Southeast Asia in terms of market capitalization, which is projected to balloon to $14 billion or around P560 billion from P338 billion currently.

At the same time, SM Prime’s total assets will also increase to P284.1 billion from P148.1 billion; revenues will rise to P57.4 billion from P30.7 billion; annual net income will grow to P17.0 billion from P10.9 billion once consolidation is finished.

As of end-September, SM Prime’s profits grew 13.38% to P8.73 billion from P7.7 billion the previous year. Revenues climbed 12% to P24.77 billion from P22.10 billion, while cost and expenses rose 12.06% to P11.71 billion from P10.45 billion.

Shares of the company lost 60 centavos or 3.24% to close P17.90 apiece on Friday from P18.50 each on Thursday. — Claire-Ann Marie C. Feliciano