REIT Financial News - 18 MAR 2010: CCT raises S$225 million 5-year unsecured convertible bonds due 2015

CCT raises S$225 million 5-year unsecured convertible bonds due 2015.
See press release.

Key Points

• S$225.0 million convertible bonds due April 2015 have been fully placed to institutional investors and accredited investors.
• The bonds are unsecured and convertible into new CCT units at a conversion price of S$1.356 per new CCT unit.
• The bonds are at an interest rate of 2.7% per annum, payable semi-annually.
• Net proceeds of the issue for general working capital, asset enhancement and refinancing of existing borrowings.

Author's Note
Following A-REIT's offer of new debt instrument (ECS) for proactive capital management, CCT has followed with its issue of convertible bonds. According to the CEO, the interest rate of the bonds at 2.7% p.a. will help to lower the average cost of debt for the Trust. Based on the latest earnings report presentation slides, the average cost of debt is at 3.9%. The bonds, being unsecured, also helps to preserve CCT’s existing pool of unsecured properties, latest valuation at S$2.8 billion, for any growth opportunities in the future.