International Financing Review Asia November 25 2017 41COUNTRY REPORT SINGAPORESINGAPORE
DEBT CAPITAL MARKETS
› SMU SELLS RARE BONDSTertiary education provider SINGAPORE
MANAGEMENT UNIVERSITY sold rare S$150m
(US$111m) of five-year bonds at 1.945% last
Tuesday through sole bookrunner DBS.
The offering was marketed at a fixed
coupon and were priced with a spread of
8bp. The tight pricing reflects the issuer’s
Aaa Moody’s rating, as well as its scarcity
value.
The institute has only one outstanding
issue.
The tightly held S$100m 3.155% 2024
bonds were issued three years ago.RESTRUCTURING
› GATE SEEKS BONDHOLDER SUPPORTSemiconductor assembly-and-test company
GLOBAL A&T ELECTRONICS has asked bondholders
to sign up to a revised restructuring
support agreement, having raised the
coupon on new bonds it is offering as part
of the accord.
The proposal follows a protracted legal
battle, in which some holders of Gate’s
US$625m 10% senior secured bonds due
2019 issued in February 2013 protested that
the conversion of a second lien loan into an
additional US$502m of the same series of
notes in September 2013 was unfair.
Under the latest proposal, Gate will issue
US$665m in 8.5% secured notes due 2022- up from 7.75% on its previous one. The
initial holders will receive US$517.64m of
new notes, plus US$8.89m in cash, and the
additional holders would receive US$84.9m
in notes and shares equivalent to a 31%
stake in UTAC Holdings, the parent of Gate,
as part of a corporate reorganisation.
Gate estimates the proposal will give
initial holders a projected recovery rate
of 89.25%–93.70%, and investors in the
additional notes a recovery rate of 19.05%–
21.90%, not including the value of the
shares they will receive.
Some holders of the initial notes sued
Gate over the conversion of the loan, and
they will receive an additional US$11.11m
of new secured notes and US$1.11m in
cash.
In September, Gate offered initial holders
US$540m of 7.75% five-year notes, plus an
extra US$15m of notes and US$5m in cash
to those suing the company. It had offered
additional holders US$100m in new notes
and a 30% stake.
That plan, however, failed to appease a
group of the initial holders, represented
by Dechert and in possession of 40% of the
notes issued in February 2013.
If Gate wins support for the proposal, it
plans to begin Chapter 11 proceedings no
later than December 17.› TRIKOMSEL TO MEET BONDHOLDERSIndonesian mobile phone retailer TRIKOMSEL
will meet holders of its Singapore dollar
bonds on Thursday.
The company’s appointed liquidators,
Luke Furler and Cameron Duncan of
KordaMentha, will arrange the informalmeeting. Holders of a combined S$215m
of bonds will be updated on the status of
the winding-up process for Trikomsel and
subsidiary Trikomsel Singapore.
The Singapore High Court in July granted
a winding-up application from Trikomsel
and Trikomsel Singapore. Trikomsel
defaulted in 2015 on a S$115m 5.25% bond
due in 2016 and a S$100m 7.875% bond due
in 2017.
Investors holding S$78.1m of the 2016s
and S$76.25m of the 2017s accepted a debt-
for-equity exchange, which ended on June
27.
Under the restructuring plan,
noteholders accepting the exchange
offer will receive a pro rata interest in a
Singapore law-governed trust establishedEzion wins holders’ support
Restructuring Majority vote in favour of waiver of default and covenantsEZION HOLDINGS has won majority consent for its
restructuring proposals from holders of six of
its bonds of a combined S$575m (US$424m).
The oil-rig and support-boat company
launched a consent solicitation in October
to amend and waive certain covenants. It
also asked bondholders to vote on various
restructuring , which effectively included a
haircut on their investments.
The consent relates to the S$110m of 4.7%
2019s in series 003, S$60m of 4.6% 2018s in
series 004, S$50m of 4.85% 2019s in series
005, S$55m of 5.1% 2020s in series 006,
$150m of 4.875% 2021s in series 007 and
S$150m 7% subordinated perpetual securities
in series 008.
At the meeting on November 20, between
94.87% and 98.82% of holders of the six
bonds voted in favour of the proposals.
Specifically, Ezion had asked for approval
to reduce coupons and waive any event of
default in series 003 to 007. It also plans
to delete financial covenants and amend
the negative pledge to allow it to grant
any security in new borrowings under a
refinancing exercise. In series 008, the
company also asked to reduce the coupon,
waive payment of coupons and to allow
convertibility of the perpetual into shares.
Ezion has a seventh outstanding bond, a
S$120m 3.65% DBS-committed funding-
backed note due 2020, the terms of which are
not expected to change.
Investors also voted for their choice of
restructuring options. Close to 60% of the
holders of series 003 to 007 chose option A to
refinance into 0.25% series B convertible bonds
due 2023, while 16% chose refinancing series A0.25% non-CBs due 2024 in option B.
Some 5.3% of those holding the perpetual
elected for refinancing series C 0.25% non-
CBs due 2027 in option C, while 20.78%
opted to continue to hold the proposed
amended series 008 notes in option D.
The restructuring options were tweaked
in favour of holders soon after launch. The
improvements included a higher redemption
premium and a fee of 6,000 shares for an
early consent in option A. In option B, the
conversion price was lowered after a 10%
discount with an early conversion discount
and warrants thrown in, plus an early consent
fee.
Revisions in option C included a higher
redemption premium and an early consent
fee, while those in option D included a
discounted conversion price and a longer
conversion period.
Tricor Singapore was the meeting agent on
the consent exercise.B
In another development, the Singapore
High Court ruled in favour of Ezion to strike
out a bondholder’s originating summons.
This resulted in the dismissal of last
month’s summons, which Ravi Murarka filed,
asking the court to declare that the Singapore
oil-rig and support-boat company’s shares
had “ceased to be traded on the SGX-ST
within the meaning of condition 6(i) of the
terms and conditions of the notes, as added
by clause 5 of the pricing supplement for the
notes”.
The move would have allowed holders
of the DBS Bank-backed 3.65% bonds due
2020 to request immediate repayment.
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