SGD New Issue Review : Ezra 2Y
2 Ezions this year and now Ezra as they bag a new sub-sea projects in West Africa and Asia, including a deepwater pipeline installation project in the South China Sea, collectively worth US$125 mio which means they need to borrow up.
They have a term loan of USD 58 mio due this year and another SGD 394 mio worth of liabilities due next year as they refocus on the sub-sea segment energy business for the future.
EZRA S$ 2 YEAR
INITIAL PRICE GUIDANCE : HIGH 4%s
ISSUE SIZE : TBD
USE OF PROCEEDS : FOR REFINANCING THE EXISTING BORROWINGS OF THE ISSUER AND ITS SUBSIDIARIES
TIMING : THIS WEEK’S BUSINESS, AS EARLY AS TODAY
Stock price not going anywhere after the hullabaloo of a Samsung takeover in 3Q last year but the abrupt reopening of their 09/2015 last year at 100 which meant they were paying 5% for 2 years makes this high 4% look unappetising. The 09/2015 paper has since traded higher after floundering for some months. Current indicative price is 100.80/101.30 ( 4.43/4.09%).
Demand for shipping papers has not been forthcoming with supply aplenty. Ezion maxed out their borrowing limits their final SGD 55 mio 6 year paper 2 weeks ago at 5.1% after their 4.85% 5 year issue earlier in Jan this year.
I say we should see decent demand at 4.875% for those who missed out on the 5.1%, and if order books exceed expectations, we can be sure that the whole chain gang will flood the marketplace in the days ahead with hands outstretched.
hi TH,
I am not sure if they are still proceeding with the subsea IPO, although if they do, then its probably better for bond holders than shareholders.
Hmmm, could be read both ways…
If subsea IPO, then what assets are left for mothership ?
They already have LOYZ and Triyards.
I suppose it depends on how the IPO (if it comes to pass) fares. Subsea accounts for 60% of their revenues, so yes mothership will look light depending on what’s left. But a good IPO will free up cash. I suppose for bond holders, we just care if the company will be around to pay up when the bond is due.