CEBU CITY – To partially refinance outstanding foreign currency-denominated loans and fund general corporate purposes, the Energy Development Corporation (EDC) during its recent investor’s briefing here, offered P12 billion worth of fix-rate bonds to potential investors.

During the briefing which took place in the last leg of the nationwide presentation of said bond offering, EDC Chief Executive Officer Paul Aquino said the bonds bear a maturity of five and a half years and seven years due on June 4, 2015 and December 4, 2016 respectively.

“The five-and-a half-year bond will yield an interest of 8.61 percent, while the 7-year investment provides 9.322 percent” said Aquino.

The public offer period for the bonds is slated November 18 to November 26 while the issuing date is set on December 4, 2009. Minimum investment was set at P20,000, and in multiples of P10,000 thereafter. The interest income is, however, subject to a 20 percent final withholding tax.

Other executives from EDC’s partner institutions, including BDO Capital and Investments Corporation which is the issue manager and bookrunner; and BPI Capital Corporation, Rizal Commercial Banking Corporation, and Security Bank Capital and Investments Corporation as underwriters, were also present.

In the open forum that followed the briefing, BDO Capital Senior Vice-President Eleanor Lee Hilado, noting liquidity in the market at present, expressed confidence that the floated bond will be over-subscribed.

She disclosed that interest payment will be calculated on a 30 over 360 days count basis, payable semi-annually in arrears, while the principal repayment of the bonds will be redeemed at par or 100 percent face value on their maturity date.

Hilado noted that the issuance of bond offerings by several major companies, including Globe Telecom, San Miguel Brewery, Aboitiz Power, and Robinsons Land, have met with positive results; other firms also expected to issue bonds this year are JG Summit, Filinvest Land, and MegaWorld.

It can be recalled that EDC, the country’s leading geothermal energy company, first tapped the local debt market in June this year with the issuance of P7.5 billion worth of fixed rate bonds. Such issuance strongly attracted investors to a point where it caused a 2.5 percent oversubscription.