Globe gets SEC nod for P10-billion bond issue

MANILA, Philippines - Globe Telecom obtained the Securities and Exchange Commission’s nod to issue P10 billion worth of five-year and seven-year fixed-rate bonds.

The bonds will be sold to both institutional and retail investors at 100 percent of face value. Interest rate will range from 5.3262 percent to 5.4762 percent.

The offer period will run from May 21 to May 25.

Depending on market conditions and reception to the issue, Globe may issue an additional tranche of P5 billion.

The issue was assigned a PRS Aaa issue rating, which means that the obligor’s capacity to meet its financial commitment on the obligation is extremely strong.

BPI Capital Corp., The Hongkong and Shanghai Banking Corp. Ltd., and RCBC Capital Corp. are the joint lead underwriters for the issue.

Proceeds from the offering will be used to partly fund the company’s massive network modernization and IT transformation program, which will require an investment of $790 million. Of the total, $570 million will be spent in 2012 and 2013.

Given the growing demand for bandwidth-heavy services, the modernization program will bring significant improvements to Globe’s network capacity leading to improved reliability, ease of access and pervasive coverage.

The program includes upgrading to a more efficient and HSPA+3 and LTE4 ready network by deploying single-cabinet base stations with more efficient energy and site footprint, and Software Define Radio (SDR) base stations that support multiple technologies and allows for flexible and quick capacity expansion for future need.

The transport facilities will also be upgraded to a more resilient, all-IP architecture to improve scalability and traffic efficiency through increased fiberization of access and fringe core network and deployment of 40/100 Gbps Dense Wavelength Division Multiplex5 (DWDM) transport backbone.

Globe, a joint venture between Ayala Corp. and Singapore Telecom, currently has over 30 million mobile subscribers, over 1.411 million broadband customers, and over 671,000 landline subscribers.