THE Securities and Exchange Commission (SEC) has approved the P8-billion unsecured fixed-rate bond float of Filinvest Land Inc. (FLI).
FLI filed the application in June, which covers the principal amount of P5 billion and an over-allotment option of P3 billion.
The bonds have the same terms when FLI issued its P7-billion bonds last year, the SEC said. The company said the paper will have a tenor of seven years, which would have an interest rate based on the secondary-market rate plus a spread of 125 to 165 basis points.
The yield of the 10-year paper will also take in the secondary-market rates and a spread of 145 to 185 basis points.
“Proceeds of the offer will be used to finance the company’s capital expenditure requirements for the third quarter of 2015 and 2016,” the company said.
The company said it will spend P20.2 billion in capital expenditures from the third quarter through the fourth quarter of next year.
It will spend a total of P4.5 billion for its residential projects, P6.7 billon for the retail leasing and P8.92 billion for the office leasing.
“FLI also intends to utilize internally generated funds considering that the projected total-capital expenditure [for the period] is greater than the net proceeds of the offering,” it said.
FLI bagged the contract to develop a smaller portion of Cebu’s South Road Properties (SRP) after Cebu City government declared FLI as the winning bidder for the 19.2 hectares of land. The property will be developed and owned by FLI, together with its office development subsidiary Cyberzone Properties Inc., its central business district affiliate Filinvest Alabang Inc. and other possible strategic partners, the company said.
“The property will be developed in accordance with the required minimum-development plans of the Cebu City Government as specified in the bidding guidelines, where 70 percent of the buildable area is intended for commercial and/or office use, and the remaining 30 percent for residential use. The new development will complement the ongoing City di Mare project of FLI in SRP,” the company said.
The bigger portion of the SRP, involving some 26 hectares of reclaimed land, was earlier won by a partnership of SM Prime Holdings Inc. and Ayala Land Inc.