The Market Monitor Minding the Nation's Business
By Riza Lozada
Listed DoubleDragon Properties Corp. reported successfully tapping the retail bond market with its maiden issuance of P5.3 billion worth of 10-year Fixed Rate Retail Bonds due 2026, which listed on the PDEX board on December 15, 2016.
The issuance exceeded the initial base size of P5 billion, which was met with strong demand from retail investors, banks, pension funds, insurance companies and retirement funds alike.
“The Philippine Services Corp. (Philratings) assigned the newly issued Retail Bonds an Issue Credit Rating of PRS Aa,” the corporation reported.
The Retail Bonds were issued at a coupon rate of 5.9721 per annum fixed for the next 10 years until its maturity on December 15, 2026.
“Due to the substantial demand for the Retail Bonds, the coupon was priced at the lowest end of the pricing range set by its Joint Issue Managers and Joint Lead Underwriters, BPI Capital Corp. and RCBC Capital Corp.,” the corporation disclosed.
“This issue generate investor demand strong enough for the company to exercise some of its oversubscription option which signals investors’ positive views on DoubleDragon. This also indicates the level of investor trust and appreciation of the firm’s two principles. Edgar “Injap” Sia II and Tony Tan Caktiong, as successful builders of businesses and well-known brands loved by many of our fellow countrymen, Mang Inasal and Jolibee,” Philippine Dealings System (PDS) Group chairman and CEO Cesar Crisol said.
The issuance marked the first tranche of its 3-year Retail Bond Shelf Registration approved by the Securities & Exchange Commission (SEC) with an aggregate amount of P15 billion, which the company expects to fully cover the capital expenditure requirements to complete its 2020 goals of developing 1 million square meters of leasable space.
Philratings assigned an Issue Credit Rating of PRS Aa to the said bond issuance. Obligations rated PRS Aa are of high quality and are subject to very low credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong, an earlier disclosure of DoubleDragon said.
DoubleDragon, formerly Injap Land Corporation, started commercial operations in November 2010. DD was originally 100 percent-owned by Injap Investments, Inc. (IJI), a holding company owned by the Sia family. In June 2012, DD became a joint venture between IJI and Honeystar Holdings Corp, the holding company of the Tan and Ang families.
DD and its subsidiaries own, lease, and enter into joint venture agreements covering several tracts of land for community malls, office, residential and other types of developments. As of December 31, 2015, DD’s subsidiaries include DoubleDragon Sales Corp., One Eleven Property Management Corp, Piccadilly Circus Landing Inc. (PCLI), Double Dragon Property Management Corp., DD Happyhomes Residential Centers, Inc., DD-Meridian Park Development Corp., and CityMall Commercial Centers Inc.