ICTSIs offshore unit raises $450M

by James Loyola
August 19, 2015 (updated)

International Container Terminal Services, Inc. (ICTSI), through its offshore unit Royal
Capital B.V., has raised US$450 million after successfully pricing its senior perpetual capital
securities. The proceeds will be used for refinancing and fund its capital expenditures.
In a disclosure to the Philippine Stock Exchange, ICTSI said this is its second successful
senior perpetual capital securities issuance, after the US$300 million issue which was priced on
January 22, 2015.
We are pleased with the success of the new issue of senior perpetual securities. This
transaction, which forms part of ICTSIs overall capital management strategy, achieves for us
the twin objectives of lowering our cost of capital and maintaining significant reserve leverage
capacity, said ICTSI vice president and treasurer Rafael J. Consing, Jr.
The New Perpetual Securities brings additional liquidity for ICTSI and allows ICTSI to
further enhance its capital structure to better match its long-term port concessions, which have
maturities up to 2055.
ICTSI said it intends to use proceeds from the offer of New Perpetual Securities for
refinancing and general working capital purposes, including to fund capital expenditures.
The firm said it remains the only Philippine issuer to have offered U.S. dollar senior
perpetual securities in the international debt capital markets.
It also marks the lowest U.S. dollar coupon obtained by a Philippine corporate perpetual
security and managed to achieve a significant reduction in coupon versus this Januarys
transaction.
ICTSI said the New Perpetual Securities were widely distributed with fund managers
accounting for 59 percent, banks for 11 percent, and private banks for 30 percent. By
geography, the Philippines took up 14 percent, rest of Asia 70 percent, and Europe 16 percent.
The New Perpetual Securities confer a right to receive distributions at a rate of 5.5
percent per annum and were priced at par to yield 5.5 percent per annum.
Royal Capital will have the right to redeem the New Perpetual Securities onMay 5,
2021 and any semi-annual distribution payment date thereafter.
The rate of distribution for the New Perpetual Securities will be reset every five years
from May 5, 2021 and will increase by 2.50 percent per annum on May 5, 2021, in each case if
the New Perpetual Securities were not already redeemed by the Issuer.

Consistent with the requirements for equity under IFRS, the issuer may resolve, at its
discretion, to defer payment of distribution otherwise payable on a distribution payment date.
Citigroup Global Markets Limited, Credit Suisse Securities (Europe) Limited and
Standard Chartered Bank acted as Joint Lead Managers for the New Perpetual Securities
issuance.

Source: http://www.mb.com.ph/ictsis-offshore-unit-raises-450m/