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.