SINGAPORE — Singapore Airlines, the flag carrier of Singapore, launched a 1.5 billion yuan ($221.1 million) five-year dim sum bond on Tuesday with a yield of 2.38 percent, according to an updated term sheet reviewed by Reuters.
Derived from the famous bite-sized Hong Kong cuisine, a dim sum bond is a bond issued outside of mainland China, particularly in Hong Kong, but denominated in Chinese currency. These bonds provide foreign investors with a way to invest in Chinese currency to bypass China's strict capital controls.
The airline had earlier marketed the offshore yuan bond, issued outside mainland China, with initial price guidance of about 2.8 percent, according to a previous term sheet.
The deal drew orders of more than 7.2 billion yuan, including 1.8 billion yuan from joint lead managers' international accounts, a separate deal message showed.
Proceeds will fund aircraft purchases and related payments, general corporate needs, working capital and refinancing of existing debt, according to the term sheet.
The bonds are expected to settle on June 30 and will be issued under the airline's SG$10 billion ($7.7 billion) multi-currency note program. It will mature in 2031.
Bank of China, DBS, HSBC, and Standard Chartered are joint lead managers and bookrunners.
Singapore Airlines on Monday said it planned to sell its first five-year benchmark dim sum bond and had hired four banks to arrange the potential deal.
