Megaworld to issue 7-year dollar notes

MANILA, Philippines - Megaworld Corp., the upscale property development firm of tycoon Andrew Tan, will issue seven-year dollar-denominated notes to refinance debt and fund operations.

The bonds, which will mature in 2018, will be listed on the Singapore Exchange Securities Trading Ltd. (SGX-ST).

While the terms of the issue size and interest rate have yet to be finalized, the International Financing Review earlier reported that Megaworld was planning to raise $200 million from the bond float with the guidance interest in the 6.875 percent range.

Megaworld said “approval in principle” has already been received for the the listing of these notes. UBS is the lead manager for the issue.

Proceeds from the issue will be used to refinance a portion of the company’s outstanding debt and for general corporate purposes.

The issuance follows a successful placement by Megaworld’s parent firm Alliance Global Group which raised a total of P9.73 billion.

Shares of Megaworld closed unchanged yesterday at P2.31 apiece.

Megaworld is accelerating its expansion this year with plans to roll out 18,673 residential units with an aggregate floor area of more than 830,000 square meters.

The company has slated for turnover a total of 5,700 units covering Bellagio 3, Forbeswood Parkland Tower 2, Residential Resort in Newport City Sarasota and Pinecrest, Stamford Executive Residences Tower 1, 2 and 3, Manhattan Parkway Tower 1 and 2, Cityplace Tower A and B, Greenbelt Chancellor Greenbelt Excelsior, and Greenhills Heights.

Megaworld and sister companies Empire East Land Holdings Inc. and Suntrust Properties are accelerating their respective expansion programs with plans to launch P60 billion worth of projects this year.

Megaworld expects its rental income to exceed P4 billion this year with the completion of Lucky Chinatown Mall, which will have more than 108,000 sqm. of retail space by end-2011. It will also complete more than 77,700 sqm. of new office space to cater to the growing demand of business process outsourcing (BPO) companies.

The company will also boost its rental portfolio of BPO office developments and retail malls from 453,600 sqm. in 2010 to around 639,400 sqm. by end-2011.

The Megaworld Group has built more than 210 residential and office buildings with a total floor area of around 5.4 million sqm.

Megaworld is the first to develop an information technology park in the Philippines through its project in Eastwood City, which provides a 24/7 work environment to BPO operations.