ST Engineering unit to issue US$750m 1.5% notes under new programme

SINGAPORE Technologies Engineering's (ST Engineering) wholly-owned subsidiary, ST Engineering RHQ (STE RHQ), has priced US$750 million in five-year notes with a 1.5 per cent fixed-rate coupon.

The senior unsecured notes are expected to be issued on April 29, 2020, and will mature on April 29, 2025.

Net proceeds of the offering will be lent by STE RHQ to ST Engineering or the group, to fund new capital expenditure, acquisitions, general corporate purposes and/or refinancing of existing borrowings, ST Engineering said on Wednesday night.

DBS Bank and JPMorgan (SEA) are the joint global coordinators for the notes. The joint bookrunners for the deal are DBS Bank, JPMorgan (SEA), Crédit Agricole Corporate and Investment Bank Singapore Branch, Mizuho Securities Asia and Standard Chartered Bank.

Application will be made to the Singapore Exchange for permission to deal in and the listing and quotation of the notes.

The US$750 million notes will be issued under STE RHQ's new S$5 billion multicurrency medium-term note programme, which is unconditionally and irrevocably guaranteed by ST Engineering.

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The programme was set up in March 2020 to support the group's long-term strategy to enhance shareholder value, ST Engineering said.

It enables the group to tap the debt capital market for longer-tenor financing to optimise its short-term to long-term debt mix and its capital structure.

The S$5 billion programme replaces the US$1.2 billion multicurrency medium-term note programme established in July 2009 and terminated in December 2018.

Shares of ST Engineering fell S$0.04 or 1.2 per cent to finish trading at S$3.29 on Wednesday, before the announcement.