Genting offering more bonds

Singapore News
Genting S'pore to offer up to S$500m worth of perpetual securities
By Thomas Cho

SINGAPORE: Integrated resort operator Genting Singapore will offer a second issue of perpetual securities worth some S$500 million.

At a media briefing on Monday, Genting's Chief Financial Officer Lee Shi Ruh said the second tranche is targetted at retail investors after Genting received an overwhelming response to its first S$1.8 billion offering in March.

Genting has indicated that the proceeds raised could be used to expand into Japan and South Korea.

Magdalene Choong, investment analyst, Phillip Capital, said: "If I am a Genting investor, I will actually sell the shares and buy the bonds instead.

"If you based on the previous dividend payout, it is about 0.63 per cent of dividend yield and the company has no dividend policy but on the other hand, this preferred security is offering about 5 per cent (per) annum."

Genting will sell up to S$500 million in perpetual securities, with half of the offering set aside for retail investors, some S$50 million to be offered to directors and employees, and the balance S$200 million to institutional and other investors.

There is also an option to issue another S$200 million in the event of over subscription.

Carey Wong, senior research manager, OCBC Research, said: "We think it is pretty positive because that will increase its growing cash hoard from its expansion of business. They have been talking about going into overseas markets like Japan and Korea."

Fitch Ratings is maintaining a Triple BBB despite the introduction of a second tranche.

Genting will need to foot at least almost S$118 million in interest payment per annum for the perpetual securities.

But analysts think Genting must have a degree of confidence to clinch projects at an even higher rate of return, otherwise they will be doing injustice to their shareholders.

- CNA/cc/ck

Genting issues more bonds, this time for retail investors
By Jonathan Kwok
Retail investors will finally get a bite of Genting Singapore's much publicised perpetual bond issue, after being left out of the first issue in March.

The integrated resort operator had raised $1.8 billion in a highly successful exercise in March but the minimum subscription size was $250,000, leading to some rumblings that small-time players were being left out in the cold.

But in its latest issue, announced by Genting Singapore on Monday, the subscription starts at $5,000, and investors will be able to subscribe in lots of $1,000 above that. The company hopes to raise $500 million from this exercise.

'This round is really for the retail investors, the man on the street,' said Genting Singapore's chief financial officer Lee Shi Ruh in a briefing. 'The purpose of this is really to tap on a different pool of investors.'

Genting Singapore to issue S$500m in perpetuals
SINGAPORE: Casino operator Genting Singapore PLC is planning a second issue of perpetual
securities worth about US$397 million and could use the proceeds to expand into Japan and South Korea, a senior executive said today.

Genting Singapore, a unit of Malaysian group Genting Bhd, plans to sell S$500 million (US$397 million) in perpetual subordinated capital securities, a hybrid of bonds and equities, to mostly retail investors.

This follows its S$1.8 billion issue of perpetual securities last month that was sold mainly to institutional and private banking investors.

“We are well positioned for opportunities such as those in Japan and Korea,” chief financial officer Lee Shi Ruh said at a media briefing.

Casinos are banned in Japan but a group of lawmakers is pushing for a bill that could legalise them. In South Korea, only one of its casinos is open to citizens and it is located in a rural area far from major cities.

Lee said the potential liberalisation of Japan and South Korea’s gaming industries could follow a similar path to Singapore, which legalised casinos in 2005. The two integrated casino resorts in Singapore have helped boost its tourism industry.

If Genting Singapore, which runs the Resorts World Singapore casino, invests in Japan or South Korea, the projects would most likely be in new “greenfield” developments rather than acquisitions, Lee said.

The company is open to acquisitions in other markets, Lee said, but she declined to name them.

Genting Singapore’s latest issue will pay an annual coupon of 5.125% until October 2022 and 6.125% after that, with the company having an option to redeem the securities in 2017.

Issuing perpetual securities has been growing in popularity in Asia, due partly to favourable accounting practices that could translate into lower leverage ratios for companies.

DBS is the sole global coordinator for the offering. DBS and Oversea-Chinese Banking Corp are the joint lead managers and book runners.

- Reuters

Genting Singapore to issue $397mil in perpetuals

Genting Singapore to issue US$397 mln in perpetuals