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Manila Bulletin devider Business devider The Stock Market devider SM Prime plans ₱17-billion bond offering to refinance debt

SM Prime plans ₱17-billion bond offering to refinance debt

Published Sep 15, 2025 12:00 am  |  Updated Sep 13, 2025 01:23 pm
After interest rates have been cut, Sy-led SM Prime Holdings Inc. (SM Prime) is now planning to refinance debt with a ₱17-billion bond offering just after raising $350 million from United States (US) dollar-denominated notes.
SM Prime, one of Southeast Asia’s largest integrated property developers, is planning to issue bonds worth ₱12 billion, with an oversubscription option of up to ₱5 billion.
The proposed issue represents the third tranche of the company’s shelf registration debt securities program of up to ₱100 billion.
Philippine Rating Services Corp. (PhilRatings) said it has assigned the highest issue credit rating of PRS Aaa to SM Prime’s proposed bond issuance.
The ratings agency also maintained its issue rating of PRS Aaa for SM Prime’s outstanding bonds amounting to ₱141.5 billion. A stable outlook has been assigned for the proposed and outstanding bonds.
Obligations rated PRS Aaa are of the highest quality, with minimal credit risk; the obligor’s capacity to meet its financial commitment on the obligation is extremely strong. A stable outlook indicates that the rating is likely to be maintained in the next 12 months.
PhilRatings said the assigned issue ratings and corresponding outlook consider SM Prime’s well-experienced shareholders and seasoned management; solid brand equity; improved margins, backed by sustained profitability; and healthy cashflow generation and satisfactory capitalization structure.
Last week, SM Prime raised $350 million from its inaugural US dollar-denominated debt offering in the bond market. It priced the drawdown from its $3-billion multi-issuer euro medium-term note (EMTN) program at a coupon rate of 4.75 percent, the lowest coupon for such an issuance since September 2020.
The issuance was almost three times oversubscribed, with final demand reaching over $990 million. This issuance represents the second drawdown under the multi-issuer EMTN program with parent company SM Investments Corp. (SMIC).
“Through this latest drawdown, we are able to tap the market at an opportune time to support our future projects and strategic initiatives,” said SM Prime President and Chief Executive Officer (CEO) Jeffrey C. Lim.
In the first six months of 2025, SM Prime’s consolidated revenues rose by 5.2 percent to ₱68 billion, led by a 7.1-percent increase in rental income to ₱40.5 billion.
Real estate sales reached ₱20 billion, while other revenues grew by 6.7 percent to ₱5.6 billion. Net income improved by 10.5 percent to ₱24.9 billion, with net margin increasing to 36.6 percent.
“Profitability and cash flow generation are expected to be sustained, while the capital structure is seen to gradually strengthen through earnings retention and debt reduction,” said PhilRatings.

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SM Prime Holdings Inc. Jeffrey C. Lim Philippine Rating Services Corporation
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