SGD New Issue Review : ASCENDAS REIT SGD 7YR 3.375%
NEW ISSUE: ASCENDAS REIT SGD 7YR – IPG 3.375%
Issuer: HSBC Institutional Trust Services (Singapore) Limited (in its capacity as trustee of A-REIT)
Status: Senior, unsecured, off SGD5 bio Multicurrency Medium Term Note Programme
Issuer Rating: A3 stable (Moody’s)
Exp Issue Rating:A3 (Moody’s)
Format: Reg S, S274 & 275 of Singapore SFA
Tenor: 7 Years
Issue Size: TBD
Initial Price Guidance: 3.375% area
Payment: Semi-annual, Actual/365 (fixed)
Issue Date: [●] June 2015
Maturity Date:[●] June 2022
Delisting of A-REIT: At par, in accordance to the Programme
Redemption upon Termination of A-REIT: At par, in accordance to the Programme
Details: SGD250,000/SGX-ST/CDP/Singapore Law
Sole Bookrunner: DBS
Timing: As early as today
** ASCENDAS REIT SGD 7yr – UPDATE 1 **
– New Ascendas Reit SGD 7y announced, anchored by reverse enquiries
– Initial price guidance at 3.375% area
– Expected issue rating: A3 (Moody’s)
– Timing: As early as today
AReit 4 % 2022 (A3) at 104.75, 3.20%
CapitaLand Mall Trust 3.48% 2024 (A2) at 101.75, 3.25%
Starhill Global Reit 3.4 2023 (BBB+/*) at 100.18, 3.37%
Mkt Cap S$ 6.1 bio. Divd Yield 5.75%.
Last share price S$2.53, well above book value of $2.08.
7 year rate 2.36% which gives up a credit premium of just over 1% for this bond – WOW !! Much better than the Starhill deal 2 weeks ago or the Mapletree Industrial Trust done last month where both paid under 1% for 8 years.
Well, we cannot have A-Reit increasing their size of their MTN programme from S$ 1 bio to S$ 5 bio ! (5 times) in March without having them issue some bonds after that !
Lucky that A-Reit has nothing much to do with the Temasek merger with JTC earlier this year and we should expect business as usual unlike the case of the Ascendas perpetual bond which are being tendered back at 101 after the change of control clause was triggered.
Chances of A-Reit delisting ?
Then why would they increase the MTN programme ?
More likely a buying spree to bolster their falling rentals and EPS.
For this heavyweight name, the 2nd largest reit in Singapore space, I would expect this fairly priced coupon to sell given that HDB is going at 2.6% for 8 years and government bonds are giving about 2.15%.
2 questions for your comments please:
(1) Where the 7Y rate at 2.36% comes from?
(2) What’s the chances of A-Reit and MIT merger?
1. Market trading price
2. No idea why they should merge.
1. Is it the daily price for 7y interest rate swap?
2. Just in case these two merge – any impact (good or bad) on their listed bonds?
NEW ISSUE: ASCENDAS REIT SGD 7YR
– Books are in excess of S$300MM
– Final price guidance at 3.20% (the number)
– Issue size: Capped at S$150mm
– Books subject at 3.45pm, today’s business
Order book >SGD300m from 52 accounts
By investor type
Fund managers/ insurers/ banks 91%
Private banks 5%
New AREIT 3.2% 06/2022 OPENING PRICE 100.25/100.55
AREIT 3.2% 06/2022 100.30/100.40