Emirates closes Singapore bond issue

Abu Dhabi: Emirates airline yesterday announced the successful close of its debut Singapore dollar bond issue. It sold S$400 million in five- and 10-year bonds, making its issue the biggest by a Middle Eastern company in the primary market.

The aggregate issue size of S$400 million comprised three tranches to the investors: a five-year S$200 million floating rate tranche, which was sold at 63 basis points above the six-month swap offered rate, and a five-year S$50 million fixed rate tranche which was sold at 4.28 per cent, 63 basis points above the prevailing five-year swap offered rate, and finally a ten-year S$150 million fixed rate tranche which was sold at a coupon rate of 4.64 per cent, 85 basis points above the prevailing 10-year swap offered rate.

The five-year floating rate tranche will pay a coupon of 0.63 per cent per annum over the six-month SGD swap offer rate. The five-year and ten-year fixed rate tranches will pay coupons of 4.28 per cent per annum and 4.64 per cent per annum respectively.

"We are gratified by the investors' response to our first bond offering in the Singapore market, which testifies to their confidence in Emirates' financial performance and credit quality. It is evident that our consistent profitability and sound management are recognised," said Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates Group.

The issue will be listed on Singapore Exchange Securities Trading Limited. The joint lead managers and joint bookrunners to the issue were Citigroup, DBS Bank Ltd and Standard Chartered Bank. A total of 30 investors, mostly Singaporeans, subscribed to the bonds.

According to company sources, the proceeds from the bond issue will be used for general corporate financing purposes.