MANILA, Philippines–Ayala Land Inc. has raised P16 billion in fresh equity from a “top-up” private placement Friday night, venturing into the capital market early in the year to boost fresh funds for expansion.
Inquirer sources said ALI placed out 484.85 million common shares at a price of P33 a share or at a 5.7-percent discount to Friday’s closing price and a 3.9-percent discount to the five-day volume-weighted average prior to the deal.
The fund-raising was done through a “top-up” placement whereby controlling shareholders lent some of their shares for sale to new investors but they will subscribe to the same number of shares at the same price in the future, allowing new money to flow into the company.
Book-building for the placement was opened on Friday and completed overnight with UBS as arranger. The deal was priced at the middle of the offering price range of between P32.75 and P33.50 a share, the sources said.
“Order book was well oversubscribed with significant participation of long-only investors,” said one source. Another source said about 60 high-quality institutional investors participated in the deal, about 85 percent of which consisted of those investing for the long term.
Asked about the equity deal, a spokesperson from ALI said there was “no official disclosure regarding the matter at this time.” ALI president Bernard Vincent Dy added: “We will have a disclosure Monday (today).”
Shares of ALI bucked the local market’s overall upswing on Friday, declining by 0.71 percent to close at P35 a share. At this latest closing level, it had a market capitalization of P500.21 billion.
ALI, which has mapped out aggressive expansion plans across different market segments and geographical location, remains upbeat on the Philippine property market.
Under its new president Dy, ALI unveiled last November a program to further grow its business by 20 percent annually in the next six years, with the end-goal of breaching a net profit of P40 billion by 2020.
The 2020 goal seeks to build on the momentum of the “5-10-15” strategy—achieve P10 billion in net income and 15 percent return-on-equity (ROE) over a five-year period—set during the term of Dy’s predecessor Antonino Aquino, who retired in April last year. It is also more aggressive than many analysts’ growth expectations.
ALI spent P58.98 billion for project and capital expenditures in the first nine months of 2014, 61-percent more than the level spent during the same period in 2013. Bulk of capital expenditures in the first nine months went to project completion (65 percent of total) with the balance spent on land acquisition (35 percent).
The company was expected to have disbursed close to its target capital spending of about P70 billion in 2014.
As of end-September last year, ALI had a cash hoard of P35.71 billion. Total borrowings stood at P113.26 billion, translating to a debt-to-equity ratio of 1.09:1 and a net debt-to-equity ratio of 0.74:1. Return on equity was at 14 percent as of September 2014.
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