Standard Chartered Viet Nam places REE’s $100 million fixed rate bonds

Tuesday, Jan 29, 2019 19:11

Refrigeration Electrical Engineering Corporation successfully issued VND2.3 trillion ($100 million) fixed rate bonds. — Photo

Standard Chartered Bank (Viet Nam) Limited on Tuesday successfully placed Refrigeration Electrical Engineering Corporation’s (REE) inaugural VND2.3 trillion ($100 million) fixed rate bonds.

The issue was guaranteed by Credit Guarantee and Investment Facility (CGIF), a trust fund of Asian Development Bank rated AA internationally by S&P.

The VND2.3 trillion fixed rate bonds are priced at an interest rate of 7 per cent a year for a 10-year maturity term.

REE operates in the fields of real estate development and management; mechanical and electrical engineering services; manufacturing, assembling and sales of Reetech air-conditioner systems, as well as power and water utility infrastructures. It is among the 30 largest listed companies in terms of market capitalisation on the Ho Chi Minh City Stock Exchange.

Despite market volatility, bidding interest, especially in the longer tranche, remains strong. In view of the favourable pricing, the issuance strategy was adjusted by shifting the 7-year demand into the 10-year tranche.

This is the sixth time that SCB Viet Nam has acted as the bond issuance agent for a guaranteed Vietnamese dong-denominated corporate bond issue in Viet Nam.

“The successful issue has contributed to deepening and developing Viet Nam’s local capital markets, as it encourages more corporate issuers to consider the country’s bond market as a viable financing option,” said Nirukt Sapru, CEO Viet Nam and ASEAN & South Asia Cluster Markets, Standard Chartered Bank.

“We see it as an important milestone as we continue to widen our funding options and sources in line with our business development and expansion needs,” said Nguyen Ngoc Thai Binh, REE’s chief financial officer.

By bringing new and credible issuers like REE to the Vietnamese dong bond market, we hope to encourage more institutional investors to provide long-term funding to firms who require such funding, Kiyoshi Nishimura, chief executive officer of CGIF said. — VNS

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