Singapore Airlines raises $808 million in US dollar bond offering


SINGAPORE  (REUTERS) – Singapore Airlines (SIA) said on Thursday (Jan 13) it had raised US$600 million (S$808 million) in a US dollar bond deal to help fund aircraft purchases and repay existing borrowings as it grappled with lower travel demand amid rising Omicron infections.

The seven-year notes, its second United States dollar bond offering, have a coupon of 3.375 per cent. A year ago, it raised US$500 million in a five-year issue with a 3 per cent coupon.

The airline was aiming to raise between US$500 million and US$750 million, two sources with direct knowledge of the matter told Reuters on Tuesday.

The Government last month froze the sale of tickets for arriving flights under its quarantine-free travel programme for four weeks, citing the risk from the fast-spreading Omicron coronavirus variant.

Before this offering, the airline had raised $21.6 billion of liquidity during the pandemic and had untapped debt facilities of $2.1 billion as at Sept 30, according to its latest financial results presentation.

Despite the fall in travel demand, SIA has been spending billions of dollars renewing its fleet to help lower fuel burn and carbon emissions.

Net proceeds from the issue will be used for aircraft purchases, aircraft-related payments and general corporate or working capital purposes, including to refinance existing borrowings, SIA said.

SIA will issue the notes under its $10 billion multi-currency medium-term note programme.

The joint global coordinators for the issuance are Citigroup and DBS Bank. The banks are also joint lead managers along with Standard Chartered Bank Singapore and BNP Paribas.

SIA shares were trading unchanged at $5.02, as at 9.38am on Thursday.

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