SMDC to list 1.37-billion shares

MANILA, Philippines - SM Development Corp. (SMDC), the residential property firm of the family of retail tycoon Henry Sy, secured the approval of the Philippine Stock Exchange (PSE) to list 1.37 billion common shares to cover its stock rights offering worth nearly P5 billion.

Based on documents submitted to securities regulators, SMDC said shareholders can buy one rights share for every three shares held as of Dec. 7, 2009 at an indicative price of between P3.40 and P3.60 each share.

SMDC said the offer price will be based on a 10-to 15-percen discount to the volume weighted average price of the company’s common shares traded in the PSE for the 15 trading day period immediately preceding the pricing date on Nov. 23, 2009.

The offer period is scheduled to run from Jan. 4 to 8 wihile the listing of the shares has been tentatively set on Jan. 18.

Proceeds from the rights issue will be used for landbanking and for other general corporate purposes.

BDO Capital and Investment Corp., also owned by Sy, will serve as underwriter for the rights issue.

SMDC currently has seven on-going projects – the fifth cluster of Chateau Elysee (a six-cluster mid-rise condominium project in Parañaque City) which is 88-percent complete; Berkeley Residences in Katipunan Road, across Miriam College and Grass Residences beside SM City North EDSA (with the first tower 47-percent complete); Sea Residences near the Mall of Asia Complex in Pasay City and Field Residences in Sucat, Parañaque.

Other projects slated for launch this year are Princeton Residences (a 37-story condominium building located in 2,400 square meter property along Gilmore St., Quezon City), Sun Residences beside Welcome Rotonda in Quezon City, Jazz Residences along Jupiter St., Light Residences in Mandaluyong City and Wind Residences in Tagaytay City.

SMDC has earmarked P7.2 billion for capital expenditures this year or 40 percent higher than what is spent in 2008. Around 80 percent of the capital budget will be sourced from internally generated funds while the remaining 20 percent will come from borrowings

SMDC reported a net income of P1.4 billion in the first nine months of the year, more than 60 times the P23 million recorded the same period a year ago on the back of robust sales and higher completion rates of its various projects.