DMCI unit’s issuance of P1-B home bonds gets SEC nod

CONSUNJI-LED DMCI Holdings Inc. said the Securities and Exchange Commission (SEC) has approved its subsidiary’s issuance of P1 billion worth of fixed-rate retail bonds.

In its registration statement DMCI Project Developers Inc. said it will issue the deferred coupon-paying paper dubbed as Homesaver bonds.

The company said P500 million will be offered to the public, while the remaining half will be issued within a year—the shelf life of the registration with the SEC, or a period prescribed by relevant regulations.

“With the offer, the company aims to encourage this segment [low- to middle-income market] to save sufficient funds to enable them to own real-estate property in the future,” the company said.

For the initial offering, the company will have net proceeds of P474.66 million after upfront fees and expenses.

There will be a total of 2,755 bond holders for the said offering which will be offered in three tranches. DMCI said the proceeds of the funds are not projected to fund any specific transaction other than for working capital and general corporate purposes.

“The offer is primarily intended to assist retail investors in accumulating savings to be used as down payment for a DMCI Homes unit. Capital raising is only secondary to the foregoing purpose,” it said.

The bonds will be sold by an underwriter on a best efforts basis, and the amount of the proceeds will be received by the company in the course of five years, as some of the paper can be paid on a deferred basis.

Tranche A bonds, which carries a yield of 4.5 percent per year, will be issued for 36 consecutive months from the issue date; tranche B, which has a rate of 5 percent, will be offered for 60 consecutive months; and tranche C, which will have a rate of 4.5 percent, will be offered one time on the issue date as a single upfront investment and payable in lump sum.  SB Capital Investment Corp. has been tapped as the issue manager and underwriter for the deal.

The paper will have a maturity of three and five years.

DMCI Homes Inc. posted a slight profit increase of 4 percent to P1.72 billion during the first half of the year ending June due to the recognition of higher revenues from completed high-rise projects in the first six months.

Excluding the effect of a gain on sale of undeveloped lot last year, the company’s net income actually rose by 18 percent during the period, the company said.

The company said posted P10.44 billion in sales and reservations during the first six months, also a 4-percent increase from the P10.08 billion reported last year.

“We want to give the middle class better options and high-value for their money. As their purchasing power evolves, so does our product offerings,” DMCI Homes President Alfredo Austria said in a statement. Sustained demand for residential condominium units in new and existing projects such as helped push sales, it said.

Sales and reservations for the year are expected to reach P22 billion from last year’s P20 billion, the company said,

To fuel its growth, DMCI Homes is expanding its real-estate portfolio to cater to the upper middle-class market.


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