New Issue Review : ASL Marine 4.75% 4Y SGD

Should be a small issue (<100 mio).

Small company (mkt cap SGD 293 mio which is smaller than Swiber) and very much family owned which is why it is does not prefer to dilute equity.

ASL Marine Holdings Ltd. is a dynamic offshore and marine company listed on SGX Mainboard since 2003. ASL Marine is principally engaged in shipbuilding, shiprepair and conversion, shipchartering and other marine related services, catering to customers from Asia Pacific, South Asia, the Middle East and Europe and Australia.

– Comps:
ASLSP 4.5 2014
SGD 50 mio issued in 2011 at 4.5% 3Y.
Current price 100.50/101.00 (3.96/3.43%)

Family owned is good because major stakeholders would be perceived to do the right thing.

Pet Peeves
– lien-ed assets as how all shipping companies work so only the photocopy machines are left in the end
– cyclical market risks such as the cancelled contracts eg. Keppel’s recent headlines
– illiquidity which is a major problem for Swiber bondholders now

I think the best comparable would be Nam Cheong NCL 6% 11/2015 which is trading at 101.00/101.50 (5.581/5.375%) given that ship building is their mainstay.

Nam Cheong is less leveraged and a bigger operation (mkt cap 536 mio,  although they are in the O&G space.

Swiber would make everything else look bad, to be honest. Just take a look at this.

Swiber Holdings Ltd 9.75 PERP/CALL 92 94 SGD 80 MIO
Swiber Holdings Ltd 5.9 25-Jul-14 100.59 100.9 SGD 120 MIO
Swiber Holdings Ltd 7 6-Jul-16 99.25 100 SGD 75 MIO
Swiber Holdings Ltd 6.25 8-Jun-15 99.75 100.5 SGD 95 MIO
Swiber Holdings Ltd 5.8 6-Aug-13 100.5 101 SGD 150 MIO
Swiber Holdings Ltd 5 16-Oct-14 102.492 103.8 USD 35.6 MIO
Swiber Holdings Ltd 5.8 11-Oct-13 N/A N/A SGD 80 MIO

Verdict : Not my cup of tea.