- Details
- Category: Companies
- 04 May 2014
- Written by VG Cabuag
LOW-COST housing developer 8990 Holdings Inc. is set to securitize P1 billion of its receivables, portfolio in June, a company official said.
President and Chief Executive Officer Januario Jesus Gregorio Atencio said 85 percent of the receivables will be converted into 12-year notes with a 7.5-percent coupon rate. The remaining 15 percent will be subordinated debt or a credit enhancement that will be used in case the house owner preterminates the contract or has decided to pay for the unit in full.
SB Capital Corp. is the underwriter for the said measure.
“We are excited about this. When we are successful in doing these, then we are successful in giving a viable alternative to housing finance aside from the provident fund and the banking system,” Atencio said.
“We want to propose this to other developers so they can actually join the securitization bandwagon,” he said. The said measure is the private-sector counterpart of the P4-billion housing asset-backed securitization measure launched last year by the National Home Mortgage Finance Corp.
“There’s a lot of interest. We can look forward to have it fully subscribed,” Atencio said.
“This activity is the first ever in the Philippines that is a purely private- sector securitization effort.”
The company, which sells under the brands Deca Homes for the horizontal subdivision and Deca Urban Homes for condominium projects, is selling up to 1.2 billion shares, with an overallotment option of 134.95 million shares in its follow-on offering.
About 72.3 percent of the firm’s shares and 65.2 percent of the offer shares (or about 900 million offer shares) were already bought by cornerstone investors Malaysian firm Pasir Salak Investments Ltd. and TPG Rafter Holdings Ltd.
The two firms will shell out a combined P2.9 billion for the said shares, the company said. The rest of the shares will be sold to retail investors from May 2 to 8.
VG Cabuag
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