Bonds are a good way for diversifying your portfolio. Recently, property firm Perennial Real Estate Holdings (PREH) launched a 3-year bond to the retail market, at 4.65%pa. At the current bearish and volatile market, this may prove a good asset to have in your portfolio. Most bonds are longer term, whereas Perennial is offering their bonds for 3 years, which makes this bond offer: 4.65%pa over a 3 year period - rather reasonable.
The net proceeds from the issue of the retail bonds are presently intended to be used for general corporate purposes, including refinancing of existing borrowings and financing of working capital, investments (including mergers and acquisitions) and/or capital expenditure requirements of the Issuer of its subsidiaries.
Summary Points about Perennial Real Estate Holdings
(taken from the company's announcement document from SGX):
1. Sizeable Mainboard-listed real estate owner, developer and manager with a market capitalisation of approximately S$1.56 billion. Established integrated real estate platform managed by proven and experienced management team led by Mr Pua Seck Guan.
2. S$6.20 billion asset size supported by strong equity base of S$3.85 billion. Conservative financial position with net gearing ratio of 0.41x.
3. Strong and reputable sponsors with extensive network and business experience, comprising Mr Kuok Khong Hong @ Kuok Khoon Hong, Mr Ron Sim Chye Hock, Wilmar International Limited and Mr Pua Seck Guan, who together hold over 74% effective shareholding interest in the Issuer.
4. The Group has a diversified and quality portfolio measuring over 45 million square feet in total gross floor area, of which about 50%1 are income-generating assets located in Singapore and the People’s Republic of China (the “PRC”).
5. Singapore portfolio of operational iconic assets which are predominantly located in the Downtown Civic District, Central Business District and Orchard Road precinct generating stable income stream.
6. PRC portfolio comprising mainly prime large-scale integrated developments which are close to major transportation hubs providing strong growth pipeline.
7. Part-sell part-hold strategy for selected assets, such as TripleOne Somerset and AXA Tower in Singapore and mixed-use developments in the PRC, optimises cash flow and capital management.
Details Of The Bond:
- Bond Size: Up to S$150 million, and can be raised to $300 million if public offer is oversubscribed
- Payment Frequency: Semi-annually
- Subscription Period: 9.00am on 13 October 2015 to 9.00am 21 October 2015
- Expected Bond Issuance Date: 23 October 2015 (ie. will be reflected in your CDP account)
- Expected Commencement of Trading: 9.00am 26 October 2015
- Minimum Investment Amount: S$2,000 and higher investment amounts are in integral multiples of S$1,000
How To Apply?
You may apply via:
- ATMs of DBS, OCBC, UOB
- Internet banking websites of DBS, OCBC, UOB
- mobile banking interface of DBS
More articles on Perennial's bond issue:
http://www.straitstimes.com/business/perennial-offers-3-year-retail-bonds-at-465
http://www.dealstreetasia.com/stories/singapore-perennial-realtys-retail-bond-issue-oversubscribedconsiders-increase-to-215m-15625/
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