Public application for the SIA bonds amounted to S$346 million, way more than the S$50 million that was originally allocated to the public. As a result, SIA decided to increase the public tranche size to S$150 million.
In meeting the demand, SIA decided to give everyone who applied an allocation. Demanding on the number of SIA bonds you applied for, you will get a prorated amount.
For example, all those who applied from $10,000 to $39,000 would be given $10,000 of SIA bonds.
The full SIA bond allocation details can be found here:
There is one exception though – those with invalid applications. This group of people will have their money fully refunded without any interest.
I know of a friend who applied for SIA bonds using a joint bank account/CDP account. It was mentioned somewhere in the 100+ page offering document that application to joint CDP accounts will have issues.
As a result, his money was fully refunded. My friend only found out when his money was fully refunded after the application date has closed and he realised what had gone wrong by checking the offer document.
11 comments
DanielP says:
October 2, 2010 at 6:07 pm (UTC 8)
Thanks for the update, I was under the impression that I could apply for IPOs under a joint name account but I had to specify a personal CDP.
lioninvestor says:
October 2, 2010 at 8:46 pm (UTC 8)
Hi Daniel,
Yes, I think you are right. I have amended my post slightly. My friend used a joint bank account to apply for a joint CDP account, so it failed.
AK71 says:
October 3, 2010 at 8:20 pm (UTC 8)
I do not think this is a good deal. I wonder at the strong response but rationalised that there is still much risk aversion in the air.
lioninvestor says:
October 4, 2010 at 12:08 am (UTC 8)
Hi AK71,
A lot of those risk adverse people who typically leave their money in their bank would be interested in this. Not everyone invests in Reits like you do.
Jasmin says:
October 3, 2010 at 9:27 pm (UTC 8)
I can’t think of any IPO which allows a joint CDP a/c.
PC says:
October 5, 2010 at 10:42 am (UTC 8)
Hi Lion,
Sorry resending :
Siber Holding just announced – that it has today priced S$80,000,000 in principal amount of 5.80 per cent. fixed rate notes due 2013 (the “Notes”) under its S$500,000,000 Multicurrency
Medium Term Note Programme (the “MTN Programme”). Appreciate if you give your opinion as to why are they giving such generous dividend compare to other issuers. I am sure if they could get bank loans the interest they need to pay is even much lower as banks now are cash rich.?
lioninvestor says:
October 5, 2010 at 11:31 am (UTC 8)
Hi PC,
You have to look at their balance sheet. Possible reasons could be that banks might not want to lend if they already have a lot of debt.
Bond yields will also depend on their credit rating. Obviously, people would trust SIA more than they trust Siber. To get people to take up their bonds, Siber will obviously have to offer a higher coupon.
PC says:
October 5, 2010 at 12:56 pm (UTC 8)
Thanks for your comment, Iwill read their balance sheet to review if Swiber’s bond is worth the risk.
Regards,
PC
lioninvestor says:
October 5, 2010 at 1:28 pm (UTC 8)
Actually, don’t think the retail market can subscribe for this.
Gary says:
November 1, 2010 at 10:52 am (UTC 8)
Why did SIA issue bonds at that time instead of preference shares or other forms of financing?
lioninvestor says:
November 1, 2010 at 11:24 am (UTC 8)
Dear Gary,
It’s a cheap source of financing.