AN offshore subsidiary of International Container Terminal Services Inc. (ICTSI) is raising $450 million through the issuance of new securities as an “opportunistic prefunding” for the company’s capital requirements for 2016.
A disclosure to the local bourse showed that the Royal Capital BV, a subsidiary of the port operator, has issued new senior perpetual-capital securities with a 5.5-percent yield per annum payable semiannually in arrears. It will be listed on the Singapore Stock Exchange.
“This transaction has cost and risk management elements to ICTSI’s rationale. Particularly, this is an opportunistic prefunding of ICTSI’s requirements for 2016 ahead of potential interest-rate volatility in the coming months,” ICTSI Treasurer Rafael J. Consing Jr. said in a text message.
He said the transaction is part of the company’s capital management strategy.
“This transaction, which forms part of ICTSI’s overall capital management strategy, achieves for us the twin objectives of lowering our cost of capital and maintaining significant reserve leverage capacity,” Consing said.
Profits of ICTSI climbed down by a notch during the first half of the year due to the absence of a one-time gain registered in the same period the year prior.
The listed port operator booked a net profit of $100.4 million in the first semester, a percent lower than the $101.7 million booked in 2014.
This, despite the 8-percent increase in gross revenues to $552.1 million and a slower 2-percent rise of gross expenses to $226.5 million in the first half.