Globe plans no additional dollar bonds.

SINGAPORE (Dow Jones) Globe Telecom Inc. has no plans to issue additional US dollar bonds despite its recent request that holders of its 2012 bonds increase the tap amount laid out in the covenant to $200 million from $125 million, Rizza Eala, vice president financial planning and analysis, said.
The request for a covenant change last week caused a sell-off in the outstanding bonds of the Philippines second-largest cellular company, with traders fearing additional supply.
Our funding for 2004 is already complete, Eala said. Any additional funding would be on an opportunistic basis because we havent firmed up our needs for 2005.
She said the change to the tap component of the covenant was secondary to changes in the formula for computing the amount the firm can distribute as dividends.
The covenant change that we were really after was increasing the flexibility on the shareholder value side.
She said it was still much cheaper to raise funds through the loan market than through the bond markets, but the tap increase would allow the firm to raise small amounts of money if necessary or to smooth the firms debt profile.
The firm has had no indication yet of how many bondholders have agreed to change the covenant on the $200 million in bonds issued in April 2002. The deadline to file responses is 1700 New York time July 19. The firm needs at least 51 percent agreement in order to change the covenant.
Other than the 2012 paper, Globe also has a 2009 bond outstanding. The firm will repay holders of the latter bonds next month when a call date comes around.
Globe sold the $220 million bond in 1999 and its lower credit profile at the time meant the firm had to pay a coupon of 13 percent. The 2012 paper, by contrast, has a much lower coupon of 9.75 percent.
Globe bought back some of the 2009 paper in 2003 and earlier this year. As of end-March, there was $151 million outstanding of the bond still outstanding, Eala said.
The firm is refinancing around $100 million of the repayment with a $50 million loan and a P3 billion retail bond that it issued in February.
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