Ezra raises S$150m from issuance of perpetual securities
Ezra Holdings Limited (Ezra, the Group), a leading global offshore contractor and provider of integrated offshore solutions to the oil and gas (O&G) industry, has announced that it has launched and priced its first Singapore dollar denominated Subordinated Perpetual Securities (the “Securities”) to raise S$150 million. This issuance is the second offering under Ezra’s US$500 million Multicurrency Debt Issuance Programme (“Debt Issuance Programme”) established on 28 August 2012, the Group press release said.
The Securities will bear an initial fixed distribution rate of 8.75% per annum for the first three years. The distribution rate will be subject to reset every three years and includes a one-time step-up from and including the first reset date, 18 September 2015. Additionally, Ezra may choose to redeem in whole the Securities on or after the third anniversary of the issuance.
DBS Bank Ltd. and The Hongkong and Shanghai Banking Corporation Limited are the appointed dealers for the Securities. The issuance of the Securities was well received and the order book was multiple times oversubscribed with participation from more than 50 investors. In terms of geographical distribution, the allocation was primarily to Singapore based investors. In terms of investor classes, a substantial portion of the issue was allocated to private banks, with sizable interest from institutional investors and asset managers.
The Group’s recent benchmark S$200 million, 5% 3-year fixed rate notes issued on 7 September 2012 also received strong interest from investors. The net proceeds of both issues will be used to refinance the Group’s existing borrowings, as well as for general working capital and general corporate purposes.
Ezra’s Managing Director, Mr Lionel Lee, said: “The strong appetite for our notes and securities in support of our efforts to strengthen our balance sheet reflects investor confidence in Ezra and our future.
“By diversifying our sources of funding and extending our debt maturity profile, it positions the Group well ahead of any global uncertainties and allows Ezra to take advantage of the many opportunities we see in subsea construction and offshore support services.”
Mr Clifford Lee, Head of Fixed Income at DBS, said: “This is indeed an important milestone for Ezra’s continuous efforts in setting its credit benchmark in the debt capital markets following its recent 3-year SGD note issue. The issuance of both the notes and perpetual securities has allowed Ezra to create a transparent SGD credit yield curve which will be useful for its future debt raising exercises. DBS is extremely proud to be part of this ground breaking transaction.”
Mr Jason Khoo, Head of Debt Capital Markets, South East Asia at HSBC, said: “The strong investor response to Ezra’s perpetual securities issuance represents a clear endorsement of investor appetite for Ezra’s credit, and represents a strong testament to Ezra’s credit standing, following their successful SGD senior bond issue. The perpetual securities issuance enhances the company’s capital structure and is instrumental in providing the issuer with greater financial flexibility going forward.”
As part of the Group’s long-term expansion strategy, its engineering and fabrication division TRIYARDS Holdings Pte. Ltd. is expected to list on the SGX-ST by way of introduction via a proposed dividend-in- specie. Ezra will retain a 67% stake in TRIYARDS and shareholders will vote on this proposed distribution at the Group’s extraordinary general meeting scheduled for 27 September 2012.
On 6 September 2012, EMAS AMC, Ezra’s subsea division EMAS AMC announced a contract award from ABB for the installation of subsea power
cables from the world’s largest natural gas production platform, the Troll A gas platform in the North Sea.
EMAS – a leading global contracting group providing offshore/subsea construction, marine, production and well intervention services – is Ezra’s operating brand. With offices across five continents, it prides itself in having the right people and solutions for the oil and gas (O&G) industry by combining its global footprint and proven engineering skills with a diverse offering of premium assets and services designed to fully meet clients’ needs.
