Singer debenture issue at 14.50% oversubscribed
Singer (Sri Lanka) PLC’s three-year Listed Unsecured Redeemable
Debenture issue opened on Tuesday, May 21, was oversubscribed almost
immediately, and was subsequently closed in the early hours of the
opening day itself.
The initial issue was aimed at raising Rs. 1,000 million, with an
option to increase this amount by a further Rs. 500 million, at the
discretion of Singer, in the event of an oversubscription.
In light of the keen interest of investors in the initial issue and
its oversubscription, Singer has decided to exercise this green shoe
option by raising up to Rs. 1,500 million.
Given an A(lka) rating by Fitch Ratings (Lanka), the debentures were
issued at a fixed interest rate of 14.50% p.a. the lowest interest rate
out of all debentures issued to date in 2013. A company spokesman noted
that it was an achievement to get the issue oversubscribed at a lower
interest rate of 14.50% p.a. when other similar rated issues were raised
at much higher interest rates in the recent past. With this issue,
Singer intends to lower its cost of working capital and to shift the
emphasis from short-term to long-term funding in order to restructure
its balance sheet positioning. Indeed, the issue will have a positive
impact on the Company’s P&L statement.
NDB Investment Bank Limited acted as Financial Advisors and Managers
to the issue while Commercial Bank of Ceylon PLC acted as the Bankers to
the issue. Deutsche Bank AG, Colombo Branch is the Trustee to the Issue.
Other parties to the transaction include Nithya Partners, legal counsel
to the Issue, and Business Intelligence Limited, the Registrars to the
issue.
The success of Singer’s Issue is a reflection of the trust that
investors in particular, and Sri Lankans in general, have in the
Company.
As the country’s leading consumer durables retailer, Singer leverages
the island’s most extensive retail network to give its customers access
to the world’s best brands, products and services.
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