HONG KONG (REUTERS) – Singapore Airlines has raised US$500 million (S$663 million) in its first US dollar bond issue, which the company will use to buy new aircraft as the global aviation industry prepares for a post-pandemic travel rebound.
The transaction was finalised early Thursday and the price was set at US treasuries plus 260 basis points, according to a term sheet.
The size of the 5.5 year deal was finalised after bookrunners received bids above US$1.5 billion, and the bond carries a 3 per cent coupon rate, the term sheet shows.
The notes are expected to be issued on Jan 20, subject to the satisfaction of customary closing conditions, and are expected to mature on July 20, 2026.
Airlines are growing increasily optimistic travel will resume later this year as a number of countries roll out vaccination campaigns to combat Covid-19.
Singapore Airlines is the first major airline in Asia to tap the global debt markets in 2021, following a rush of deals in the second half of 2020.
There have been 19 deals in that time worth US$17.62 billion, the largest of which was a US$6 billion issue from Delta Air Lines in September, according to Refinitiv data.
Global airlines are expected to refinance at least US$14.9 billion worth of bonds set to mature in 2021, Dealogic data showed, while a US$23.1 billion in syndicated loans will become due this year.
- With additional information from The Straits Times