Globe raises P10 B via new shares

MANILA, Philippines - Globe Telecom Inc., jointly owned by conglomerate Ayala Corp. and Singapore Telecommunications Ltd., has successfully raised P10 billion from the issuance of new preferred shares to bankroll its capital expenditures this year.

Marisalve Ciocson-Co, assistant corporate secretary and vice president for legal affairs of Globe, informed the Philippine Stock Exchange (PSE) that the 20 million preferred shares worth P500 per share were fully subscribed.

 “We wish to inform you that the Series A non-voting preferred shares with an aggregate issue size of P7 billion and an oversubscription option of up to P3 billion were fully subscribed as of the end of the offer period last Aug. 15,” Co told the Exchange.

She added that the 14 million preferred shares or P7 billion as well as the oversubscription option of six million preferred shares worth P3 billion would be listed in the PSE on Aug. 22.

Proceeds of the fund raising activity would be used to finance the company’s capital expenditure program this year.

Globe has earmarked P29 billion for its capital expenditures this year or almost the same level as the P28.99 billion spent in 2012.

Of the total amount, the company has disbursed P11 billion in the first half of the year. Data-related access investments included deployments in Globe’s wireless 3G broadband, HSPA+ and LTE access and roll-outs for fixed broadband and LTE @Home solutions while 16 percent of the capital expenditures was made for core-related services, including payments for the network transformation program, and coverage solutions.

Globe borrowed P7 billion from Land Bank of the Philippines last December to fund this year’s capital expenditures. It signed a seven-year term loan with Landbank to finance its general and corporate requirements for 2014.

In all, Globe borrowed $235 million from Metropolitan Bank and Trust Co. (Metrobank), Bank of Tokyo - Mitsubishi UFJ, and Mizuho Bank Ltd last year to finance its capital expenditures and restructure the company’s debt profile.

Globe’s core net income that excludes the impact of non-recurring items such as the accelerated depreciation charges related to the change-out of equipment under the modernization initiatives and mark-to-market charges grew 18 percent to P7.6 billion in the first half of the year from P6.4 billion in the same period last year.