Zobel-led Ayala Corporation has successfully raised P15 billion from the public offering and sale of its Preferred Class “B” Shares (ACPB3 shares) which it will list at the Philippine Stock Exchange on Oct. 15, 2024.
The firm informed the PSE that it reissued and sold five million ACPB3 shares at P2,000 apiece for an aggregate issue price of P10 billion constituting the base size of the offer.
And, as a result of the Company’s exercise of its oversubscription option in order to address the excess demands for the shares, an additional 2.5 million ACPB3 shares with an aggregate issue price of P5 billion were sold.
Ayala has set the initial dividend rate for the preferred shares at 6.0538 percent per annum computed based on the three-day simple average of the 5-Year PHP BVAL reference rate plus a spread of 40 basis points.
Proceeds of the offering will be used by Ayala to redeem what is left of the original Class B preferred shares the company issued that is due to be called by November 29.
The company tapped BPI Capital Corporation as sole issue manager with BDO Capital & Investment Corporation, China Bank Capital Corporation, PNB Capital and Investment Corporation, RCBC Capital Corporation, and SB Capital Investment Corporation as joint lead underwriters and bookrunners.
The cumulative, non-convertible, non-participating, non-voting, redeemable, and perpetual peso-denominated perpetual preferred B shares will have a dividend rate step up on the fifth year after its issuance, if not redeemed. Ayala reserves the right to redeem the shares every dividend payment date after that.
The conglomerate is raising its capital expenditure budget by 14 percent to P284 billion this year from P249 billion in 2023 as it is confident of surpassing last year’s record financial performance.
Ayala President and CEO Cezar P. Consing said “2023 was a reasonably good year for us in aggregate. That's our new high watermark in terms of net income. It exceeded pre-COVID. It was up on the year before.”
“This year, that momentum, at least what we're seeing right now, is pretty good. And we're seeing it more evenly distributed across our many businesses… This year, I think you're going to see more of our businesses begin to show real positive events.”
Ayala Chief Finance Officer Alberto M. de Larrazabal said the bulk of this year’s capex will be spent for the expansion of Ayala Land Inc. and ACEN Corporation.
ALI raised its capex budget by 14 percent to P100 billion this year while ACEN has increased its allotment by about 40 percent to P72 billion.
On the other hand, other subsidiaries are reducing their capex, particularly Globe Telecom which has budgeted P55 billion, a five-year low as it has already scaled up its facilities in recent years.
For the parent company, including funding for the group’s portfolio investments, Ayala has allotted capital expenditures of P13 billion for 2023.