SGD New Issue Review : Golden Agri-Resources 3Y Mid 5%

Golden Agri-Resources SGD 3YR – Initial Guidance @ Mid 5%

ISSUER:  Golden Assets International Investment Pte.  Ltd.
GUARANTOR: Golden Agri-Resources Ltd
STATUS: Direct, unconditional, unsubordinated and  unsecured
FORMAT/DOCS: Registered / Issuer’s USD1.5 billion  Multicurrency Medium Term Note Programme
TENOR: 3-Year
INTEREST PAYMENT:  Semi-annual, actual/365 (fixed)
DETAILS: S$250K x S$250K / SGX-ST / CDP / Singapore Law
SELLING RESTRICTIONS: As per Information Memorandum dated 10  April 2015, including the Singapore selling  restrictions under Sections 274/275 of the Singapore Securities and Futures Act, Chapter 289, Reg S only.
JOINT LEAD MANAGERS/BOOKRUNNERS:  Credit Suisse, MUFG, Oversea-Chinese Banking  Corporation

– New SGD 3Y transaction for Golden Agri-Resources announced at initial guidance “Mid-5%” following a successful roadshow in Singapore and Hong Kong last week.
– Issue Size: expect S$100-150M
– Timing: Today’s Business

GGRSP 4.2 04/30/17       99.25 / 4.593%

Rest of the Golden Agri-Resources Issues


Golden Assets International Finance Ltd was Downgraded by RAMS (Rating Agency Malaysia Bhd) in Feb this year to Aa3 (prev Aa2) with a Negative Outlook. Moody’s last rated parent, Golden Agri-Resources, Ba2 back in 2012.

STI Index stock (0.92%). Market Cap SGD 5.48 bio (compared to last year this time 7.77 bio). Makes sense because Palm Oil was MYR2700 then vs MYR2156 (-20%) now.

They have SGD 1.86 bio in debt due over next 4 years.


Books look better than Wilmar’s.

Financial Lev 1.7 times (Wilmar 3 times Olam 4.3 times)
Debt/Assets 20.9% (Wilmar 51.3%)
Debt/Equity 35.2% (Wilmar 144%)

I wonder why they would want to come in SGD when they can get away with paying less in MYR and their SGD issue last year floundered after issuance, barely trading above 100 before sinking to its current lows (which is not bad considering how much the stock has been smashed).

With 3 year interest rates at 1.53% today, we are looking at a credit premium of close to 4% for this paper which would be the widest they have paid so far.

Perhaps paying a higher price for bonds would reduce the haze this year ? and its is smart of them to come out to tap markets now before folks start cursing them (and Wilmar) when hazy conditions return in June.

Yet it is positive to note that this would be the second commodity related bond to hit Singapore markets this year, after last week’s Indus Gas. We haven’t too many of them show their faces after last year’s spate of issuance that has left many investors smarting.

It would be safe to say we should see some decent demand for this paper at 5.5%, even from institutions as well, especially without social responsibility mandates.

Link to last year’s Golden Agri 3Y SGD Bond Review :