Aspial Corporation is inviting holders of its 5.5 per cent notes due in November 2018 or 5.05 per cent notes due in June 2019 to sell these to the company or exchange them for new notes, it said in a Singapore Exchange filing early yesterday morning.
It said the invitation is part of its strategy "to improve its debt position and to reduce negative carry", by using part of the cash proceeds from its real estate business to buy the existing notes before their respective maturity dates. The offer is for all of the outstanding $74 million worth of 2018 notes and up to $10 million of the outstanding $123.5 million of 2019 notes.
As an incentive, Aspial will pay an early exit fee of 0.1 per cent of the principal sum of the relevant tender offered notes, for holders who offer to sell by 10am on Sept 28, 2018, the expiration deadline. For those who wish to stay invested in the group, they have an opportunity to exchange their existing notes for new ones. The new notes - expected to be issued on Oct 9, 2018 and due on Oct 9, 2021 - will have a higher 6.25 per cent interest rate per annum, payable semi-annually.
To "reward note holders" for their support through their investments, Aspial will pay a one-time fee of 0.5 per cent of the principal sum of the relevant exchange offered notes to holders who offer to exchange notes by the expiration deadline.
DBS Bank is the sole dealer manager for the invitation and the dealer for the new issue. The invitation, which began at 9am yesterday, expires at 10am on Sept 28 this year.