Olam plans to issue S$100m 5.375% perps

AGRI-FOOD giant Olam International plans to issue S$100 million of perpetual securities, which will be consolidated with its existing S$250 million perps issued on Jan 18. Together, these issuances will form a single series.

The new perps are expected to be issued at 100.013 per cent of the aggregate principal amount plus accrued interest from Jan 18 to April 25. The issue date will fall on April 26, Olam said in a bourse filing on Tuesday.

The perps will bear a 5.375 per cent distribution rate for the first five years. At the end of this time period, the distribution rate will reset at a rate equivalent to the prevailing swap offer rate plus the initial spread of 4.807 per cent, plus the step-up margin of 2 per cent.

They fall under the group's US$5 billion euro medium-term note programme.

Olam will use the issuance's net proceeds for working capital purposes and general corporate purposes. These include financing capital expenditure, repaying existing debt and potential acquisition opportunities which the group or its subsidiaries may pursue in the future as part of its strategic objectives.

Olam shares closed flat at S$1.73 on Monday.