Petron launches $550-M exchange, tender offer for securities

PETRON CORP. is offering investors the option to exchange $550 million worth of its existing securities for new ones, or to sell them back for cash.

In a regulatory filing on Thursday, the oil company said investors who agree to the exchange will receive $1,000 worth of new securities in return, along with an accrued distribution amount.

“The company is undertaking the exchange and tender offer as part of a proactive approach to the strategic management of its capital structure and to extend the maturity profile in respect of its outstanding obligations,” Petron said.

At the same time, Petron plans to issue a separate round of new US dollar-denominated senior perpetual capital securities. The company expects to announce the minimum initial distribution rate on or around Sept. 15, with final pricing details and the results of the exchange to be released on or before Sept. 16.

Petron held the largest share of the local oil market at 24.9% as of June 2024, Department of Energy data showed. It has a refining capacity of nearly 270,000 barrels per day, operates around 50 terminals in the region, and runs about 2,700 service stations nationwide.

On Thursday, Petron closed at P2.45, down 0.03 or 1.21%. — Sheldeen Joy Talavera