Martin Lee @ Sg
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CMA Bonds Result 2012

As at the close of the Public Offer at 2.00 p.m. on 9 January 2012, valid applications in respect of approximately S$465 million in aggregate principal amount of CMA bonds, at the issue price of 100 per cent. under the Public Offer, were received.

As the total valid applications in respect of the Placement and the Public Offer have exceeded S$200 million in aggregate principal amount of Bonds, the Issuer has decided to exercise the right, in consultation with the Lead Manager, to upsize the Offer and issue an additional S$200 million in aggregate principal amount of Bonds, of which S$120 million will be allocated to the Public Offer.

All applicants who submitted valid applications for the CapitaMall Asia bonds under the Public Offer will be allocated a proportion of the bonds for which such applicants have applied for. The allocations are as follows:

Range of principal amount of Bonds applied for under the Public Offer (S$’000) | Principal amount of Bonds under the Public Offer allocated per applicant (S$’000)

2 | 2
3 | 3
4 | 4
5 to 9 | 5
10 to 19 | 6
20 to 29 | 10
30 to 49 | 15
50 to 99 | 24
100 to 149 | 44
150 to 199 | 66
200 to 299 | 85
300 to 499 | 125
500 to 999 | 191
1,000 to 1,999 | 365
2,000 and above | 616

It is expected that the CMA bonds will be listed for quotation on the Main Board of the SGX-ST on 13 January 2012 and that trading of the bonds will commence with effect from 9.00 a.m. on the same date, subject to the SGX-ST being satisfied that all conditions necessary for the commencement of trading in the Bonds have been fulfilled.

The CapitaMall Asia bonds will be traded on the Main Board of the SGX-ST under the trading name “CapMallA3.8%b220112”.

Leave a Comment:

sender says 8 years ago

there’re more perpetual bonds (without maturity) issues this year.
Martin – Is perpetual bond similar to preference share?

    Martin Lee says 8 years ago

    Dear sender,

    not exactly. For bonds, the issuer is obligated to pay the coupons but not for preference shares.

      sender says 8 years ago

      Martin, thanks for your reply. Have another questions:

      (1)Why is it some companies choose to issue preference shares while others choose perpetual bond issues?

      (2)Also, should perpetual bonds pay higher coupons relative to preference shares for similar rated credit qualities?

      best regards

        Martin Lee says 8 years ago

        Dear Sender,

        Actually, can’t really generalize. Need to refer to the term sheet for the specifics of the offer. In Genting’s case, the distributions could even be deferred! And they call it “perpetual subordinated capital securities”.

        “The Securities, which will be issued in the denomination of S$250,000, will be perpetual and will confer a right to receive distribution from their issue date at the rate of 5.125% per annum, subject to a distribution rate step-up on 12 September 2022, such distribution to be payable on the Securities semi-annually in arrear, unless deferred in accordance with the Terms and Conditions of the Securities”

          sender says 8 years ago

          Martin, i agree with your point on the term sheet.

          So, the Genting placement is a cumulative perpetual securities with a step-up feature.

          So, to evaluate whether perpetual bonds are indeed juicy, let’s see how such securities performed in the secondary market. My understanding is that Noble had one such placement last year around Q3 period while Olam just completed one about a month ago. There may be others offered last year that I may not aware of. Now, the problem, I don’t have preview of the secondary market prices for them. Do you have access to or from your networks that can share with us how such perpetual bonds performed relative to their par values and the bid/ask spreads??

          Thank you. Appreciate your hard work. best regards.

            Martin Lee says 8 years ago

            Dear Sender,

            your stock broker would be able to give you a list of all the Singapore bonds (and their bid/offer prices) that are traded on the secondary market. These are the $250k bonds that we can’t see on the exchange by ourselves.

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