Ayala Corporation (AC) is eyeing to issue perpetual bonds that are dollar-denominated. The firm will choose banks to handle the issuance. In a disclosure made just recently, the conglomerate told that it requested some banks for a Regulation S offering of its dollar-nominated fixed-for-life or non-deferrable perpetual notes. If you are wondering what is a Regulation S offer, it’s actually often utilized for securities that are performed outside the United States. This can be utilized to issue equity or debt securities so that a company may raise capital. Let’s take a peek at some of the important parts of this news.
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AC has tapped several banks for the offering. It includes Hong Kong Shanghai Banking Corporation Ltd. (HSBC) as the sole global coordinator for the issuance. Meanwhile, joint lead managers and joint book runners will be BPI Capital Corporation, HSBC, Credit Suisse (Hong Kong) Ltd., UBS AG Singapore Branch, and J.P Morgan Securities plc. The guarantor will be AYC Finance Ltd., a wholly-owned subsidiary of Ayala. The offer will be subjected to market conditions. These are so far the banks that will be involved in the offering Ayala is targeting to issue.
You might have heard this term just now so let me describe perpetual bonds in simple words—perpetual bonds are fixed-income security that has no maturity date. This means that it works like a lifetime because it’s unredeemable and investors are paid through a steady flow of interest payments. The risk is very slow in this investment so if you are a conservative investor and you want to invest in something where you wouldn’t have to lose money, consider perpetual bonds for stability.
While some of the companies incur losses during the first half of the year, Ayala Corporation (AC) generated earnings that are more than double during the first 6 months of 2019. The company disclosed that the net income attributable to the parent went up to 135% to P37.84 billion in the first half. Revenues grew by 8% or equivalent to P160.38 billion. The company said that the earnings during the first half of the year were because of the divestment gains from its energy and education business. The company attributed the double earnings of P41.7 billion from its business units. It can be noted that during this period, AC Education, Inc. merged with iPeople, Inc. The divestment gains we are talking about here came from the AC Education and AC Energy as well.