EEI Corporation: Perpetual Preferred Shares

This communication should be read as an introduction to the Preliminary Prospectus. Any decision to invest in the securities should be based on a consideration of the foregoing documents including the risk factors as a whole by the investor.

Overview

 

EEI Corporation (“EEI” or the “Company”), a member of the Yuchengco Group of Companies (“YGC”), is one of the leading construction companies in the Philippines and is celebrating its 90th year this 2021. The Company offers a broad range of construction and engineering services, with expertise in the construction of infrastructure, buildings, and industrial and electromechanical facilities.

 

EEI takes pride in its quadruple-A rating as a General Engineering Contractor, the highest rating for contractors issued by the Philippine Contractors Accreditation Board (“PCAB”) under the Department of Trade and Industry (“DTI”). Some of EEI’s current major projects in the country include the Metro Rail Transit Line 7 (MRT-7), Metro Manila Subway, Metro Manila Skyway, Malolos-Clark Railway Line, and New Bohol Airport.

Key Competitive Strengths:

  • EPC excellence in large scale electromechanical and infrastructure projects
  • Quadruple A rating and Large B contractor’s license
  • Strong overseas experience and partnership with foreign engineering firms for technology and best practice transfer
  • World-class Steel Fabrication Plant
  • Diversified portfolio of business
  • Strong brand equity
  • Experienced construction management team and strong construction support organization

Risk Factors:

    • Subordination to the EEI’s other indebtedness
    • The dividends on the Offer Shares may not be paid in full or in part
    • The Offer Shares have no fixed Maturity Date and EEI has the Sole Right to Redemption
    • The market price of the Offer Shares may be volatile
    • The following are some of the key factors that may affect cash flows of the Company:

– Highly capital-intensive business

– Intense competition in the industry

– A group of customers contribute a significant portion to revenues

– Highly dependent on the continued service of skilled labor force

– Exposed to potential deferrals and/or cancellation

Indicative Terms and Conditions

Issuer EEI Corporation
Instrument Cumulative, non-voting, non-participating, non-convertible, redeemable, Peso-denominated, preferred shares (the “Offer Shares”)
Offer Offering of [40,000,000] Preferred Shares with an oversubscription option of up to Php[20,000,000] Preferred Shares, to be issued in one or two subseries: Series A and Series B Preferred Shares (“Offer Shares’)
Offer Price Php 100.00 per share
Use of Proceeds The net proceeds shall be used to partially fund the Company’s future projects, for capital expenditure for new equipment, to pay existing short-term loans and for general and working capital requirements.
Minimum Subscription Each Application shall be for a minimum of [500] Offer Shares, and thereafter, in multiples of [100] Offer Shares.
Benchmark Rate Series A: 3.5-Year BVAL

Series B: 5.5-Year BVAL

Indicative Initial Dividend Rate Series A: [5.1424% to 5.7924%] p.a.

Series B: [6.4695% to 7.1195%] p.a.

Dividend Payment Cumulative, non-participating and paid quarterly.
Optional Redemption Dates Series A: 3.5 years from the Listing Date or any Dividend Payment Date thereafter

Series B: 5.5 years from the Listing Date or any Dividend Payment Date thereafter

Dividend Step-up Rate If the Offer Shares are not redeemed by the Issuer on the respective Optional Redemption Dates, the dividend rate shall be adjusted as follows:

– Series A: The higher of the (a) 5Y BVAL + [4.00%] p.a or (b) [8.00%]- Series B: The higher of the (a) 7Y BVAL + [4.00%] p.a or (b) [8.00%]

Listing The Offer Shares will be listed on the Main Board of The Philippine Stock Exchange, Inc. (“PSE”)

*As of October 13, 2021

DISCLAIMER: A REGISTRATION STATEMENT RELATING TO THE SECURITIES OF THE COMPANY HAS BEEN FILED BUT HAS NOT YET BEEN DECLARED EFFECTIVE WITH THE SECURITIES AND EXCHANGE COMMISSION AND THE PHILIPPINE STOCK EXCHANGE. NO OFFER TO BUY THE SECURITIES CAN BE ACCEPTED AND NO PART OF THE PURCHASE PRICE CAN BE ACCEPTED OR RECEIVED UNTIL THE REGISTRATION STATEMENT HAS BECOME EFFECTIVE, AND ANY SUCH OFFER MAY BE WITHDRAWN OR REVOKED, WITHOUT OBLIGATION OF COMMITMENT OF ANY KIND, AT ANY TIME PRIOR TO NOTICE OF ITS ACCEPTANCE GIVEN AFTER THE EFFECTIVE DATE. AN INDICATION OF INTEREST IN RESPONSE HERETO INVOLVES NO OBLIGATION OR COMMITMENT OF ANY KIND.

For more information, please contact

any Security Bank Branch or email [email protected], [email protected]and [email protected]

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