The Philippines’ BDO Unibank has priced its US$1bn 1-for-3 rights offering at a 24.9% discount to its 15-day VWAP to give a total deal size of Ps43.5bn (US$1bn), according to an official associated with the offering.
The rights share had been priced at Ps48.60, or US$1.12 a share, the official said. The bank plans to sell up to 895m shares during the June 18–27 offer period.
The rights price was at the higher end of the expected 20%–25% discount range because of the current weak stock market conditions, the official said.
The official said the bank was finalising the amount to be underwritten. Shareholder SM Investment Corp earlier gave a commitment to subscribe to its 44% entitlement.
The proceeds from the rights offer will be used to strengthen the bank’s core Tier 1 capital ahead of stringent new Basel III capital requirements coming into force in the Philippines next year.
After the rights issue, the bank’s Tier 1 ratio was likely to rise to 15% from 10.2%, the official said.
BDO Capital is issue manager and domestic underwriter, while Citigroup, Deutsche Bank, JP Morgan and UOB are joint international lead managers and underwriters.