Temasek launches 50-year SGD bonds for purchase outside the US
SINGAPORE (THE BUSINESS TIMES) – Temasek on Tuesday (Aug 10) launched an offering of 50-year Singapore dollar bonds, following a recent round of US dollar bonds for 10-, 20- and 40-year periods that were oversubscribed within a day. (see correction note)
Temasek said the $1.5 billion in bonds will be offered through its wholly-owned subsidiary Temasek Financial I (TFin-I) under its US$25 billion (S$34 billion) guaranteed global medium-term note programme, and will be unconditionally and irrevocably guaranteed by the Singapore investment firm.
TFin-I priced the 50-year bonds at par, with a yield to maturity of 2.8 per cent per annum, Temasek said in another statement on Tuesday night. Investors will be paid every six months.
Temasek added that there was “strong support” for the bonds from high-quality institutional, accredited and/or other specified investors based in Singapore.
The bonds are not available for purchase by US citizens or within the United States.
The offering is scheduled to close on Aug 17, and the new bond is expected to be listed on the Singapore Exchange on Aug 18.
DBS was the global coordinator for the deal; the joint lead managers and book runners were DBS, HSBC, OCBC, Standard Chartered Bank and UOB.
TFin-I intends to provide the net proceeds from the issuance of what it is calling the T2071-SGD Temasek Bond to Temasek and its investment holding companies to fund their ordinary course of business.
Ratings agencies Moody’s and S&P Global have both given Temasek overall credit ratings of triple-A.
S&P Global analyst Simon Wong said he does not expect the company’s capital structure will have any material subordination risks.
“The rating on Temasek reflects the company’s large, well-diversified, and high-quality portfolio assets; above-average investment capabilities; and minimal leverage. In addition, we see an extremely high likelihood of extraordinary support from the government of Singapore, if needed,” he said.
Correction note: A previous version of this article incorrectly stated the rate of over subscription for Temasek’s recent US dollar bonds issue. The incorrect information has been removed.