Seatrium unit to fully redeem S$500 million worth of floating-rate bonds early

SEATRIUM on Friday (Apr 26) said its subsidiary, Seatrium Offshore & Marine, has given notice to bondholders of its S$500 million floating-rate bonds that it aims to fully redeem these bonds prior to the scheduled maturity date at its principal amount, together with accrued and unpaid interest.

The S$500 million bonds due 2026 are expected to be redeemed in full on May 27, and will be cancelled thereafter, the group said in a bourse filing.

The early redemption of the bonds is part of the offshore and marine company’s capital management efforts to optimise its borrowing cost and debt profile.

To recap, the S$500 million bonds were issued by Seatrium Offshore & Marine, then known as Keppel Offshore & Marine, on Feb 27 last year.

The bonds were issued to finance a S$500 million payment Seatrium Offshore & Marine made to Keppel, in order to settle outstanding interest and make a redemption of certain perpetual securities previously issued to Keppel.

DBS was the lead manager in the bond issuance.

After Seatrium Offshore & Marine became a wholly owned subsidiary of Seatrium – which was formerly known as Sembcorp Marine – the mainboard-listed group entered into a deed of guarantee on Aug 18, 2023, to guarantee the payment obligations of Seatrium Offshore & Marine under the bonds, from and including the deed’s date of execution.

The terms of the bonds included a right on the part of Seatrium Offshore & Marine to early redemption of the floating-rate bonds prior to the scheduled maturity date.

Seatrium said the early bond redemption will not have a material adverse effect on its financial position or business operations.

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Shares of Seatrium ended 1.1 per cent or S$0.001 higher at S$0.089 on Friday, before the announcement.