Banks, fund managers snap up ST Telemedia's perpetuals

Private banks and fund managers in Singapore took the bulk of Singapore Technologies Telemedia's (ST Telemedia) $300 million offering of subordinated perpetual securities, according to statistics from deal manager DBS Bank yesterday.

Private banks, which got a 15 cent concession, received about 56 per cent of the deal, while institutional investors and fund managers took another 36 per cent. Banks and corporates took the remaining 8 per cent. Singapore investors accounted for 99 per cent of the deal, with the last 1 per cent coming from other markets.

The deal, issued under ST Telemedia's $2 billion multi-currency programme, attracted orders worth about $600 million from more than 40 accounts, which would imply a subscription rate of about two times.

The deal was priced at a distribution rate of 5 per cent, representing an initial credit spread of 270.5 basis points (bps) above the benchmark rate. The distribution rate will be reset after the 10th year and every 10 years thereafter to be the same spread against the prevailing 10-year Singapore-dollar swap offer rate plus a step-up of 100 bps.

The notes may be called by the issuer after five years.

ST Telemedia, a wholly owned Temasek subsidiary that holds a global portfolio of companies in the communications, media and technology sectors, is using the proceeds from the deal for general corporate funding requirements or investments.

A version of this article appeared in the print edition of The Straits Times on January 12, 2019, with the headline 'Banks, fund managers snap up ST Telemedia's perpetuals'. Print Edition | Subscribe