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Temasek Issuing New Bonds with Record

50-Year Tenor

Home   >  Industry News  >  Temasek issuing new bonds with record 50-year tenor

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30 September,2020

Published in: The Business Times 

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COMMENTARY

Temasek's 50 year bonds show that institutional demand remains strong for USD debt securities issued by sovereign investment vehicles. The pricing in this instance is 250bps.

Temasek Holdings has offered a three tranche offering of senior unsecured US dollar (USD) bonds which includes a 10-year, 30.5-year and 50-year tenor. The 50-year bond is the longest tenor ever offered by Temasek Holdings. 

 

The deal is unconditionally and irrevocably guaranteed by the state investment firm. The new bonds are issued under Temasek 's wholly-owned subsidiary, Temasek Financial (I) Limited (TFin-l)’s US$25 billion guaranteed global medium-long note programme. 

 

Temasek and its investment holding companies intend to use the net proceeds from the issuance to fund their ordinary course of business. An application that listed and quoted the three new bonds was made on the Singapore bourse. The joint lead managers and book runners were Barclays, Citigroup, DBS, HSBC and Morgan Stanley.
 

"Temasek plans proactively for a long dated and well distributed debt maturity profile and avoids large debt repayment obligations in any one year. We assess market conditions and take into account investor feedback along with our own requirements when looking at potential issuances." 

- Temasek Spokesperson on the reason for the longer debt


Temasek has been assigned an overall corporate credit rating of Aaa by Moody’s Investors Service and AAA by S&P Global Ratings.

Deal statistics seen by The Business Times (BT) showed that the final order book reached about US$5 billion from 284 accounts. Temasek mentioned that "support for the tranches came from high quality institutional, accredited and/or other specified investors globally." 

The Temasek Holdings subsidiary priced US$1 billion 10, 30.5 and 50 year bond as shown in the table below:

** Estimated order percentage for 10 year bond.  By geography, Asia investors piled into the 10-year issuance, with almost half the orders from the region.

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