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Philippines' biggest mall operator to raise $740M

Publication Date : 28-03-2014

 

SM Prime Holdings Inc.. the Philippines' largest mall operator, is raising about $740 million through a mix of peso and US dollar borrowings this year to fund its expansion in the country and in China.

At a press briefing late Thursday on the sidelines of a roadshow conducted in partnership with online stock brokerage COL Financial, SM Prime chief finance officer Jeffrey Lim said that after completing the consolidation of the group's key property units under SM Prime, the company had shelved for now a plan to tap the equity markets, saying it was not attractive to issue equity at current stock prices.

Instead, the company intends to tap the retail bond market some time in the second quarter or second half of the year and raise 20 billion pesos ($440 million) from the issuance of bonds with a tenor of seven to 10 years, Lim said.

Apart from the peso issuance, Lim said, SM Prime was also considering raising $300 million from a syndication of US dollar debt to fund landbanking and mall development in China.

“We’ll still need more funding for the construction of Tianjin which we’ll open next year,” Lim said.

All told, SM Prime has earmarked about 70 billion pesos ($1.56 billion) for capital spending this year.

The US dollar-denominated loan, Lim said, would be for landbanking and mall expansion activities in China.

SM Prime has bagged a new location in  the city of Yangzhou in central Jiangsu province. This city is historically one of China’s wealthiest cities, known during various dynasties for producing great merchant families, poets, painters, and scholars.

A 10-hectare property was acquired from the local government through a long-term lease in Yangzhou, Lim said.

 

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