44 International Financing Review Asia April 4 2020EQUITY CAPITAL MARKETS
› REITS UNDER EQUITY PRESSURE – OCBCSingapore’s real estate investment trusts
will come under pressure to raise equity as
the coronavirus emergency strains on their
near-term cashflows, OCBC Securities said
in a report.
The pandemic has disrupted local and
overseas travel and hit occupancy rates at
local offices, shopping centres and hotels.
The securities and futures brokerage
firm said the plan by the Ministry of
Law to introduce a Covid-19 (Temporary
Measures) Bill in parliament this week,
aimed at providing temporary relief to
businesses and individuals unable to fulfil
their contractual obligations due to the
pandemic, also makes the earnings outlook
for REITs uncertain.
Under the proposal, tenants with leases
at non-residential immovable property are
allowed to defer their rental payments for
six months without fear of legal action.
“Given that there is no clarity on how
many tenants would take this option
(although it is fair to say that it would likely
be a high proportion), we believe earnings
visibility for the sector has been clouded by
a large extent now,” OCBC Securities said.
“We believe the risk of equity
fundraising exercises has increased,
although REIT managers may seek to
mitigate the near-term cashflow constraints
by first drawing down on undrawn credit
facilities, cutting operating expenses and
capex, and seeking support from sponsors.”
The report said retail REITs had already
committed to providing rental rebates of
approximately 2-2.5 months to tenants
before the government announcement.
“Even industrial and office REITs would
not be spared from the new Bill, although
it may be more difficult for some of the
tenants to prove that their operations havebeen adversely affected by Covid-19, as
compared to retail.”
The S&P Singapore REIT index has
plunged almost 26% in the past month.SOUTH KOREA
DEBT CAPITAL MARKETS
› HYUNDAI CAPITAL RAISES US$1.8BNHYUNDAI CAPITAL AMERICA, rated Baa1/BBB+
(Moody’s/S&P), has priced a US$1.8bn 144A/
Reg S (without registration rights) triple-
trancher comprising three, five and 10-year
tenors.
The US$550m 5.75% three-year note
priced at 99.886 to yield 5.792%, or
Treasuries plus 550bp.
The US$600m 5.875% five-year portion
priced at 99.919 to yield 5.894%, or
Treasuries plus 550bp.
The US$650m 6.375% 10-year bond pricedat 99.941 to yield 6.383%, or Treasuries plus
575bp.
All three tranches priced in line with
guidance.
Proceeds of the senior unsecured notes
will be used for general corporate purposes.
Citigroup, Barclays, Credit Agricole, Mizuho
and RBC were joint bookrunners.EQUITY CAPITAL MARKETS
› TEMASEK SEALS TWO CELLTRION TRADESTemasek Holdings has raised W459bn
(US$373m) and W160bn respectively from
two block trades in South Korean drugmaker
CELLTRION and its healthcare affiliate.
The Singapore investment fund sold
about 2.57m Celltrion shares, equal to a
1.9% stake, at the bottom of a W178,695–
W182,160 range or a discount of 9.8% to the
pre-deal close of W198,000.
A total of 2.21m CELLTRION HEALTHCARE
shares, equal to a 1.5% stake, were sold
at W72,285 each, or a 8.5% discount to
the pre-deal close of W79,000, versus the
marketed range of W72,088–W73,470.
Top bookrunners of all South Korea Won bonds
1/1/20 – 31/3/20
Amount
Name Issues Won(m) %
1 NH Inv & Sec 141 8,781,000.0 19.7
2 KB Financial 132 6,591,000.0 14.8
3 Korea Investment 76 5,293,000.0 11.9
4 DB Financial Invest 42 3,979,000.0 8.9
5 Kyobo Life 45 3,380,968.0 7.6
6 Kiwoom Sec 33 3,007,777.0 6.8
7 Hana Financial 18 2,820,000.0 6.3
8 Mirae Asset Daewoo 36 2,738,000.0 6.2
9 SK Sec 27 1,735,000.0 3.9
10 Hanyang Corp 30 1,214,300.0 2.7
Total 777 44,528,404.0
*Market volume
Proportional credit
Source: Refinitiv data SDC Code: AS22South Korea global equity and equity-related
1/1/20 – 31/3/20
Amount
Name Issues US$(m) %
1 KB Financial 3 106.8 15.6
2 Goldman Sachs 1 100.4 14.7
3 Shinhan Financial 2 95.9 14.0
4 NH Inv & Sec 2 81.7 11.9
5 Mirae Asset Daewoo 2 80.9 11.8
6 Kiwoom Sec 1 68.6 10.0
7 Eugene Invest & Sec 2 55.6 8.1
8 Yuanta Financial 1 34.0 5.0
9 Hyundai Motor Sec 2 20.3 3.0
10 Hanyang Corp 1 17.4 2.5
Total 14 685.3Source: Refinitiv data SDC Code: C1QIf there are other people in your team, department or company who, you think, would benefit from the
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