Robinsons Land eyes P15B from bond mart

MANILA, Philippines - Robinsons Land Corp. (RLC), the property development company of tycoon John Gokongwei, is planning to raise as much as P15 billion from the local bond market in the first half this year.

Proceeds from the fundraising will be used to refinance maturing liabilities and support a P16-billion investment this year, company executives said yesterday.

“I would say P10 billion to P15 billion,” Lance Y. Gokongwei president and chief operating officer of RLC’s parent firm JG Summit Holdings Inc., said when asked about the planned fundraising program.

He said the property unit has P10 billion worth of bonds maturing in July and August.

“(RLC) only needs to raise P10 billion this year because that have P10 billion in maturity. But we will take the opportunity to raise more,” JG Summit senior vice-president Bach Johann Sebastian told reporters.

He said RLC is looking at seven- and 10-year bonds that will also finance capital expenditures for this year.

RLC is jacking up its capital spending by a fifth to P16 billion in its 2014 fiscal year that will end in September. The increased spending will fasttrack the construction of malls, office buildings and hotels.

Gokongwei said RLC will not find any difficulty issuing new debt papers to replace the maturing bonds. In July and August 2009, RLC issued a total of P10- billion bonds that carry an interest rate of 8.25 percent to 8.5 percent per annum.

In October to December last year, RLC recorded a 13-percent decline in earnings to P1.03 billion from P1.18 billion a year ago. RLC incurred losses from Super Typhoon Yolanda and a mall fire that affected the operations of Robinsons Place Tacloban and Robinsons Galleria, respectively.

Parent firm JG Summit listed yesterday P30 billion worth of bonds in the Philippine Dealing and Exchange Corp., the country’s trading platform for fixed income securities.

“This benchmark transaction will be instrumental for us in being able to conclude the Manila Electric Co. (Meralco) transaction last year,” Gokongwei said.

Late in September, the Gokongwei family’s listed holding firm struck a deal to buy a 27-percent stake in Meralco for P72 billion from San Miguel Corp., which is focusing on various investment opportunities like infrastructure projects and oil and gas acquisitions.

JG Summit, one of the largest and most diversified conglomerates in the Philippines, is also into budget airline (Cebu Pacific), banking (Robinsons Bank Corp.), petrochemicals (JG Summit Petrochemicals Corp.), and snacks and beverage (Universal Robina Corp.).