Genting 5.125% bond

Genting is issuing a 5.125% perpetual bond. This means that there is no fixed final redemption date. However, Genting may choose to redeem this bond 10 years later (year 2022).

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_6F2A85EA925FE130482579DA008137DC/$file/GENS_announcement.pdf?openelement

Offer information statement:
http://masnet.mas.gov.sg/opera/sdrprosp.nsf/beeb14c28bb1c29b48256b3d002f927b/EFD34C2A527432E8482579DB000D376D/$File/2.2.1%20-%20OIS.pdf

Details of the bond are as follow:


Yield
For the first 10 years, the yield is 5.125% per year.
If it is not redeemed by Genting after 10 years, the yield will increase to 6.125% per year.

Min. amount
Minimum amount to apply is 5k. Subsequent increments are in 1k.
Cash only. No CPF.

Payout
Semi-annual: 18 Apr, 18 Oct

Time table:
I have highlighted the more important dates in red below.

Lodgment of Offer Information Statement
: 9 April 2012

Opening date and time for applications for the Securities
under the Public Offer
: 10 April 2012 at 9.00 a.m.

Opening date and time for applications for the Securities
under the Reserve Offer
: 9 April 2012 at 2.00 p.m.

Last date and time for applications for the Securities
under the Public Offer
: 16 April 2012 at 12.00 noon

Last date and time for applications for the Securities
under the Reserve Offer
: 11 April 2012 at 5.00 p.m.

Balloting of applications under the Public Offer, if
necessary (in the event of an oversubscription of the
Securities under the Public Offer). Commence returning
or refunding application moneys to unsuccessful or
partially successful applicants
: 17 April 2012

Expected Issue Date of the Securities : 18 April 2012
Expected date of commencement of trading of the
Securities on the Main Board of the SGX-ST
: 19 April 2012



My thoughts
Earlier, I posted about the CMA 3.8% bond:
http://madstranger.blogspot.com/2012/01/cma-bond.html
Other CMA bond posts:
http://madstranger.blogspot.com/search/label/CMA%20bond

This bond has a yield of 5.125% which is more attractive than the CMA bond that IPOed earlier in this year. This yield is even higher than the 4.7% yield offered by the DBS preference shares.

The "perpetual bond" has little drawbacks for me. If I own this bond and I need to sell it for cash, I could sell it in the open market. Even though the volume for the bond is likely to be low, any losses incurred will be minimal. Of course, there are risks involved. If Genting is unable to payout the coupons, prices of this bond will drop badly.

I am likely to apply for this bond. Depending on the amount allocated, I might even cash out my CMA bond and use this as a replacement. If you are keen on applying this bond as well, do take note of the dates above.

Good luck to those applying for this.