BDO offering raises P43.5b
Tuesday, July 3, 2012
Source: Manila Standard By Anna Leah G. Estrada
BDO Unibank Inc., the country’s largest lender, raised P43.5 billion from its stock rights offering that drew strong interest from both local and international investors.
“The offer raised gross proceeds of P43.5 billion [equivalent to over $1 billion]. This represents a key milestone not only for BDO but also for the Philippines, being the largest ever equity capital markets transaction by a Philippine issuer,” the bank said in a statement Monday.
BDO said the share sale, involving 895.2 million common shares, was oversubscribed, as shareholders applied for shares beyond their entitlement.
“The offer also saw strong participation from the bank’s domestic and international investors, despite challenging global market conditions,” it said.
The share sale was designed to help the bank raise funds for its medium-term expansion and meet the more stringent capital requirement of Basel III, an international financial treaty signed by the Philippines.
The offering period closed on June 27.
BDO president and chief executive Nestor Tan said earlier the capital-raising program would boost the bank’s capital to P145 billion from around P100 billion.
The new shares were issued at a price of P48.60, under the 1 for 3 stock rights offer, which means shareholders were allowed to buy one additional BDO share for every three shares they owned.
The new shares will be listed on the Philippine Stock Exchange on July 4. BDO said this will raise its total number of issued and outstanding common shares to 3.58 billion.
The bank said the share sale strengthened its common equity tier1 capital. “BDO believes the offer has better-positioned it to fulfill its medium-term growth objectives and take advantage of the positive outlook on the Philippine economy,” it said.
Citi, Deutsche Bank and J.P. Morgan served as joint international lead managers and international underwriters while United Overseas Bank Ltd. acted as international co-lead manager and international co-lead underwriter. BDO Capital & Investment Corp. was the issue manager and domestic underwriter.
BDO had total assets of nearly P1.1 trillion as of end-March, including P857 billion in deposits. It operates more than 770 branch licenses and over 1,645 ATMs nationwide. It booked a net income of P2.8 billion in the first quarter, up by 15 percent from a year ago.
Tan said full-year income was expected to reach P12.5 billion in 2012, up from the actual P10.5-billion net earnings in 2011.