PLDT to issue P15-B T-bonds in Q1

MANILA, Philippines - Dominant carrier Phillipine Long Distance Telephone Co. (PLDT) is set to raise as much as P15 billion in the first quarter of next year to partially finance its capital expenditures at the same time restructure the company’s debt profile.

PLDT corporate secretary Lourdes Rausa-Chan said the company intends to issue a combination of seven and 10-year fixed rate bonds in the aggregate principal amount of up to P10 billion with an over-subscription option of up to P5 billion.

Rausa-Chan informed the Philippine Stock Exchange (PSE) that PLDT has filed an application for registration of the fixed rate bonds with the Securities and Exchange Commission (SEC).

The proposed bonds, she said, would be listed on the Philippine Dealing and Exchange Corp. (PDEX). PLDT tapped BDO Capital & Investment Corp., BPI Capital Corp., First Metro Investments Corp. as well as The Hongkong and Shanghai Banking Corp. Ltd as joint issue managers, joint lead underwriters, and joint bookrunners.

According to her, proceeds of the fund raising activity would be used to bankroll PLDT’s capital expenditures for next year and pare down the company’s debt.

“The net proceeds of the said bond issuance shall be used to finance capital expenditure and/or refinance existing obligations the proceeds of which were utilized for service improvements and expansion,” she said.

As of end-September, PLDT’s gross debt stood at $2.52 billion with maturities well spread out until 2022. About 58 percent are fixed-rate loans while 42 percent are floating rate-loans with an average interest cost of 4.54 percent.

PLDT president Napoleon Nazareno earlier said the company has allocated P29 billion for capital expenditures for next year, the same level as this year.

Nazareno said that PLDT would spend about two-thirds for its growing broadband business while one-third would be allocated to expand its fiber optic fiber network by about 10 percent next year.

PLDT’s total fiber footprint as of end-September stood at more than 75,000 kilometers including 7,200 kilometers of international submarine fiber and over 4,000 kilometers of domestic submarine fiber.

Consolidated capital expenditures for the period amounted to P14.9 billion as of end-September as the PLDT Group continues to fortify its network with a P29 billion budget despite having completed its P67.1 billion two-year network transformation program ahead of schedule.

Last August, PLDT completed a P2.5 billion expansion project involving the installation of over 5,000 kilometers of fiber optic cables to support the aggressive roll-out of high-speed data services on its fixed and mobile networks.

PLDT Chairman Manuel V. Pangilinan is confident that 2013 would be a turnaround year the country’s largest telecommunications provider as it booked a two percent increase in net income and revenues in the first nine months of the year.