Singapore Airlines raises SGD 850 million convertible bond with strong investor support

Singapore Airlines (SIA) successfully raised SGD 850 million via a convertible bond issue that has been placed with a variety of institutional investors.

The offer was more than four times oversubscribed with strong investor interest, SIA said in a press statement. As a result, the issuance was upsized from the initial SGD 750 million to SGD 850 million with more attractive terms for SIA.

The five-year bonds will carry a competitive coupon of 1.625 per cent, and can be converted into ordinary shares at a price of SGD 5.743. This is a significant premium of
45.8 per cent over the 12 November 2020 closing price of SGD 3.94.

Photo courtesy: Singapore Airlines
Photo courtesy: Singapore Airlines

SIA has appointed The Hong Kong and Shanghai Banking Corporation (HSBC) as the sole bookrunner and lead manager of the issue. This issuance further strengthens the company’s liquidity position, thereby bolstering its ability to navigate the challenges posed by the impact of the Covid-19 pandemic on the business.

Proceeds from the bonds will be used to fund operating and capital expenditure, and debt servicing.

“We would like to thank investors for the strong support. The placement was successfully executed with a highly competitive coupon and substantial conversion
premium," said Goh Choon Phong, Chief Executive Officer, SIA.

"Such attractive terms for the Company underscore the strong confidence that investors have in Singapore Airlines, as well as our ability to successfully overcome the near-term challenges and emerge as a leader in the airline industry."