One of the Philippines most stable borrowers and one of its rarer issuers will launch roadshows for its $150 million bond today.
Universal Robina, a food and beverage company, will start its Asian roadshow today.
Universal Robina is rated Ba3 and will use most of the proceeds of the debt to refinance existing debt and take advantage of low interest rates.
The company has had an excellent earnings track record in recent years. Its operating income (EBIT) has remained incredibly steady since 1998, going from $36 million to $44 million.
The predictable quality of its earnings, and the fact that it now manufactures in Thailand, China and Indonesia as well as distributing products in Singapore, Hong Kong, Malaysia and China, will give comfort that this high yield credit is a reasonably low risk bond.
Lead managers, ING and Salomon Smith Barney have nevertheless put together a bond that comes with a comprehensive package of covenants – bucking the trend with Philippine corporate deals.
The last time the company issued was in 1996 . In the fourth quarter it tripled its profit to $5.8 million, thanks to good results at home and overseas.
The company has a number one market share in the Philippines in snacks, chocolates and candies.