Smart auctions P5-B fixed rate notes

Leading wireless telecommunications operator Smart Communications Inc. marked its first peso debt capital markets issue with a successful auction of P5 billion in fixed rate corporate notes recently.

Company officials said the issue, jointly managed by Citicorp Capital Philippines, Inc. and Land Bank of the Philippines, drew a distinguished investor base, including Philamlife, RCBC, Sun Life of the Philippines and Insular Life in addition to the two joint lead managers.

Smart, a wholly-owned subsidiary of the Philippine Long Distance Telephone Co. (PLDT), achieved the lowest pricing for a corporate notes issuance in recent history, demonstrating the strong investor confidence in the company’s track record and financial capabilities.

The Smart corporate notes is made up of Series A and B with five and 10-year tenors, respectively. Series A was priced at 5.625 percent, 25 basis points lower than the Feb. 9th five-year MART1 rate of 5.879 percent. Series B, on the other hand, was priced at 6.5 percent, 26 basis points below the Feb. 9th 10-year MART1 of 6.76 percent.

The issue has the distinction of being one of the lowest-priced peso-denominated debt deals successfully closed in the Philippines .

Smart president and chief executive officer Napoleon Nazareno commented, "We are extremely pleased with the outcome of the transaction. Certainly, tapping the local debt market has become quite an attractive choice for issuers like ourselves."

Citigroup country officer Sanjiv Vohra for his part said: "Citicorp Capital Philippines, together with Land Bank, is proud to have led Smart’s first peso debt capital markets issue. The landmark pricing achieved for this transaction is testament to Smart’s outstanding credit and financial strength."