DMCI readies second offering of Homesaver bonds

MANILA, Philippines - DMCI Homes will have a second offering of P500 million in Homesaver Bonds following the success of the fixed-rate instruments it offered in November.

DMCI Homes chief finance officer Joseph Ramil Lombos said the company is looking at issuing another P500 million in bonds in February.

DMCI Homes is the housing development arm of the Consunji Group’s DMCI Holdings Inc. It has an existing authority from the Securities and Exchange Commission (SEC) to issue up to P1 billion in Homesaver Bonds.

In November, the company successfully sold P500 million for the first offering, in a deal swamped by investors.

“We’re doing another one. It’s really to make it easier for investors to buy homes,” Lombos said.

He said that in the first offer, there was already an excess of orders of P150 million.

While nothing is final yet, Lombos said terms of the second offering may be similar to the November issuance.

The P500-million bonds issued in November were composed of three and five-year bonds and were offered in three tranches.

Tranche A will be issued monthly for 36 months from issue date, Tranche B to be issued monthly for 60 consecutive months from issue date; and Tranche C to be issued on time on the initial issue date as a single upfront investment and payable in lump sum. 

The annual fixed interest rate are as follows: 4.5 percent for Tranche A Bonds, five percent for Tranche B bonds and 4.5 percent for Tranche C bonds.

As sweeteners, features of the bond include having different options upon maturity such as applying net bond proceeds when paying for DMCI Homes unit or redeeming savings with interest upon maturity; earning additional credits, which investors can use when paying for any DMCI Homes property; and also having no pre-termination fees or getting back the principal in full any time prior to maturity date. 

“The offer is primarily targeted to benefit the low to middle-income market segment. With the offer, the company aims to encourage this segment to save sufficient funds to enable them to own real estate property in the future. The Company expects to raise aggregate gross proceeds amounting to P1,000,000,000.00, broken down into P500,000,000.00 from the initial offer and an additional P500,000,000.00 from subsequent offer(s) and issuance(s) under shelf registration within one year or the period prescribed by relevant regulations, whichever is later,” DMCI said in its offer sheet.