BUSINESS FINANCE

Name: ____________________________________________ Date: _____________ Score: __________

Grade 12 - ABM

ACTIVITY: SHORT-TERM & LONG-TERM FINANCING

Direction: Read the news clipping below and answer the questions that follows. Write your
answers using a 1/2 sheet yellow with your name and section. Take a picture and send to the link
provided.

Filinvest Land raises PHP 8 billion from debt sale

By Philippine News Agency
August 21, 2015 11:15 PM

MANILA—Property developer Filinvest Land, Inc. (FLI) has raised PHP 8 billion from a bond issue
to partially fund new projects that can triple its retail and office space portfolio in the next five
years. FLI president Josephine Gotianun-Yap said the company had budgeted PHP 24 billion in
capital expenditures this year. FLI listed successfully its 7-year and 10-year peso fixed rate bonds
in the Philippine Dealing and Exchange Corporation on Thursday. The bonds attained the highest
PRS Aaa rating from the Philippine Rating Services Corporation (PhilRatings). The Gotianun-
owned property arm’s fixed rate bonds due 2022 and 2025 had an oversubscription of almost
thrice the base amount of PHP 5 billion, enabling the company to exercise the PHP 3 billion
oversubscription option approved by the Securities and Exchange Commission (SEC). “With this
bond issuance, FLI is now in full-gear for office and retail space expansion. We are tripling our
office and rental portfolio to hit close to one million square meters of gross leasable area in the
next five years. We tap the long-term bond market to match our funding sources with our project
horizons,” said Gotianun-Yap. FLI launched PHP 6 billion worth of projects in the first half of 2015
while it targets a total of PHP 16 billion for the entire 2015. It has developed over 2,400 hectares of
land and more than 600,000 square meters of prime office, residential and retail spaces. “With
country’s real estate sector experiencing a continued robust growth, in line with Philippine
economy, FLI is in the best position and time to address the needs of a flourishing economy,”
Gotianun-Yap said.

QUESTIONS:

1. What is the subject company of the clipping? What is the main business activity of the firm?
2. Why do they need financing for?
3. How much do they raise from financing? In what manner did they manage to raise funds?
4. What are the company’s plans after achieving their proposed funding?
5. What particular type of financing the company uses? Explain your answer.
RUBRIC:

Total Your
Criteria
Points Points

Content 4

Organization of Ideas 3

Conceptualization 3

Total 10

SOURCE: Interaksyon.com (2015). Filinvest Land Raises P 8 billion from debt sale. Retrieved 5 April 2016, from
http://www.interaksyon.com/business/116404/filinvest-land-php8-b-from-bond-issue-to-boost-recurring-business