Petron floats PHL's 1st company notes payable in dollars

Petron Corp. said Thursday it has completed the Philippines’ first corporate issue of peso-denominated notes payable in US dollars. The country’s largest oil refining and marketing company said in a statement the seven-year P20-billion issue carries a 7-percent coupon rate. The company said it took advantage of prevailing low interest rates and the familiarity of investors with the bond structure after the Philippines government’s successful P44-billion bond issue in September, which was also payable in dollars. “We are proud to be the first Asian corporation to issue this type of notes," Eric O. Recto, Petron president and director, said in the statement. “This innovative structure allows corporations to access competitive Philippine peso funding offshore — an alternative from the traditional dollar denominated bonds — while diversifying our investor base and removing foreign exchange risks for the company," Recto added. Issued at par, Petron’s corporate notes were fixed at 42.603:$1. “We are very pleased with the outcome of our fundraising exercise," said Ramon S. Ang, Petron chairman and CEO. “The success of the transaction validates the confidence of both the local and international investment community with Petron’s long-term viability and growth potential, including numerous synergies with the San Miguel Group," Ang said. “It likewise underscores the belief of investors in the Philippine economy," he added. For this offering, Petron hired HSBC, Credit Suisse, Deutsche Bank, and Standard Chartered as bookrunners and joint lead managers. The financial institutions booked total orders in excess of P49 billion for the transaction, with 70 percent placed by offshore investors. Petron said it will use the money to repay existing debts and for general corporate purposes that include capital expenditures. — VS, GMANEws.TV