ALI completes P12.2-B top up placement

MANILA, Philippines - Property giant Ayala Land Inc. (ALI) has tapped the equities market, generating P12.2 billion in fresh funding for its real estate developments.

The share sale continued the recent string of local firms tapping foreign funding overnight.

ALI said it has completed the sale of 399.528 million shares worth P12.2 billion at P30.50 per share or a 3.6-percent discount to the five-day average.

“Due to strong demand and the fact that the placement was almost three times oversubscribed, the company decided to increase the offer size from 320 million shares,” ALI said.

The share sale was conducted through an overnight top-up placement that was supported by parent firm Ayala Corp. (AC) and facilitated by bookrunner UBS Investment Bank.

Under the “top-up” equity placement, major shareholder AC sold 399.528 million ALI shares to foreign investors. AC will then subscribe to the same number of new shares to be issued by its property unit.

As a result of more ALI shares held by investors, AC’s stake in ALI dropped to 49 percent of common shares from 50.4 percent but the conglomerate will retain voting control as it still owns 70 percent of the voting shares.

The overnight placement came on the heels of successful share sales of Pangilinan-led Metro Pacific Investments Corp. that raised P6.12 billion and the Metrobank Group’s GT Capital Holdings Inc. that generated P14.3 billion, both in January.

“This second round of equity placement will further provide ALI the flexibility to pursue its growth plans as it continues to build a robust development pipeline moving forward,” said AC president and CEO Jaime Augusto Zobel de Ayala.

ALI said it has identified landbanking opportunities that will require P20 billion. It also allotted P46 billion for project completion, which forms part of its P66-billion capital spending this year that will also mark the launching of 69 new projects with a combined value of P129 billion.

Last year, ALI spent a record P71 billion for project and capital expenditures as it launched 67 new projects worth P110 billion.

The real estate arm of the Ayala conglomerate is set to continue this year the trend of double-digit growth in revenues and profits. Its earnings surged 27 percent to P9.04 billion last year from P7.14 billion its the previous year as revenues from its residential, hotel, office and commercial projects jumped 23 percent to P54.52 billion.

ALI is wrapping up its five to 10 to 15 program, which was launched in 2009 amid the global financial crisis. It is a five-year plan ending in 2014 that aims to boost net income to P10 billion and return on equity to 15 percent.