Conglomerate SM Investments Corp. plans to file a shelf registration application with the Securities and Exchange Commission to raise up to P50 billion to support expansion, an executive said Wednesday.
SMIC chief finance officer Jose Sio said in an interview at the sidelines of the turnover of Henry Sy Sr Innovation Center to Miriam College in Quezon City the holding company of the Sy family planned to issue retail bonds before the end of the year.
“There is a plan to issue retail bonds before the end of the year, but it is still being worked out and subject for approval by the Securities and Exchange Commission,” Sio said.
Sio said proceeds would be used for “investment purposes,” support the capitalization of subsidiaries and fund the expansion of non-core businesses.
Sio said the conglomerate was looking at issuing bonds with tenors of seven and 10 years.
Property and shopping mall unit SM Prime Holdings Inc. raised P10 billion from issuance of 10-year bonds in July.
Other companies are expected to conduct fund raising activities ahead of the expected US Fed rate hike later this year. A number of listed companies have availed of the shelf registration program of SEC to fund expansion plans.
Under a shelf registration program, securities to be issued in tranches may be registered for an offering to be made on a continuous or delayed basis for a period not exceeding three years. This means the issuers can time their capital raising activities as they are needed and/or when market conditions are favorable.
SEC also provided flexibility in the payment of registration fees. The fees are now payable per tranche of issuance and proportional to the issued value.
