Globe inks $66-M term loan

Ayala-owned Globe Telecom has signed a $66-million term loan facility with Germany’s Norddeutsche Landesbank Girozentrale to beef up the company’s capital expenditure requirements.

The loan is a three-year facility with a floating interest rate.

To boost its capex budget, Globe earlier announced it is undertaking a retail bond issue worth up to P5 billion in the first quarter of 2009.

Globe chief finance officer Delfin Gonzales said the company is currently taking steps to diversify its sources of external funding. Aside from the bond issue, the company is also looking at funding from export credit agencies.

The company has already filed an application with the Securities and Exchange Commission (SEC) for the offering of a total of P10 billion in bonds for a period of 12 months from the time the issue is approved by the SEC.

However, only P4 billion to P5 billion will initially be tapped during the first quarter, with the balance of P5 billion to P6 billion to be issued depending on how the market turns out this year. “This will allow us to save two months (for approvals) for future bond issuances and gives us a facility to quickly tap the market in the future,” Gonzales pointed out.

The issue manager for the bond issue will be BPI Capital, also part of the Ayala group.

The company’s capex budget for 2009 will be slightly lower than last year’s $400 to $420 million, as Globe takes on a more prudent view until such time that the market stabilizes.

Globe president and CEO Gerardo Ablaza said that in prioritizing the 2009 capex, spending will be calibrated to developments in both the consumer and credit markets.

He added that part of Globe’s capex for this year will still be financed via internally-generated funds.