Petron Corp raises P20B in fixed rate bonds

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Petron Corp raises P20B in fixed rate bonds
This is just the first tranche of the oil firm’s P40-billion debt securities program

MANILA, Philippines – Petron Corporation, the country’s biggest petroleum retailer, successfully raised P20 billion in fixed rate bonds, which will be used to fund existing debts and working capital requirements.

The amount represents the base offer of P15 billion and the oversubscription of P5 billion, Petron said.

This is just the first tranche of the oil firm’s P40-billion debt securities program.

Petron said the bond issue was twice oversubscribed over the base offer and was priced at the tight end of the marketing range.

“We are very pleased with the outcome of our fundraising exercise,” Petron President Ramon Ang said. 

“The success of the transaction underscores Petron’s leadership position in the industry as well as its long-term growth potential,” he added.

Highest credit rating

The Ang-led retailer obtained the highest credit rating from Philippine Rating Services Corporation (PhilRatings).

PhilRatings assigned Petron’s issue with a PRS Aaa, the highest quality with minimal credit risk.

The P20 billion fixed rate bonds consist of Series A Bonds –P13 billion maturing in 5 years with an interest rate of 4.0032% per year – and Series B Bonds – P7 billion maturing in 7 years with an interest rate of 4.5219% per year.

At the start of the year, Petron commissioned its $2 billion refinery upgrade, which increased its capability to produce more high-value fuels and petrochemicals. 

This is supported by its expanding retail network, which now stands at 2,240 service stations, currently the most extensive in the industry.

“With our strategic investments beginning to bear fruit, we are well-poised to further strengthen our bottom line and sustain our growth momentum,” Ang said.

BDO Capital & Investment Corporation, BPI Capital Corporation, and SB Capital Investment Corporation are the joint issue managers, joint lead underwriters and joint bookrunners for Petron’s latest offer.  

East West Banking Corporation and First Metro Investment Corporation are the co-lead underwriters, while PNB Capital and Investment Corporation is the participating underwriter for this transaction. –

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