Aair sector debt data

HONG KONG, January 13 (Reuters)Singapore Airlines SIAL.SI on Wednesday launched its first US dollar bond to help finance the purchase of new planes, according to a terms sheet viewed by Reuters.

The amount of the deal has yet to be formally defined, but is expected to be a “benchmark” deal, meaning it is expected to raise at least $ 300 million, according to a source with direct knowledge of the matter.

A final size will be calculated once investors place their orders, the person said. The source could not be named because the information has not yet been made public.

Tthere has been a rush of debt issuances from airlines over the past six months as carriers build up cash levels to hedge against the financial impact of the coronavirus pandemic while hoping for a rebound travel as more and more countries launch vaccination campaigns.

There were 19 deals during that period worth $ 17.62 billion, the largest of which was a $ 6 billion issue from Delta Air Lines. DAL.Nin September, according to data from Refinitiv.

Potential Singapore Airlines Investors were told that the initial price forecast for the 5.5-year deal is set at the yield of the US Treasury plus 300 basis points.

This is the first US dollar bond issued by Singapore Airlines.

Singapore Airlines has traditionally issued debt in its local currency, but the latest bond, which cannot be sold to investors in the United States, will help the airline diversify its sources of funding, according to people working on the deal who weren’t allowed to talk to the media. .

The condition sheet stated that the funds raised would be used for the purchase of new aircraft and “aircraft-related payments”.

The airline said on Monday that its passenger capacity in December was down 81.3% from the same period last year.

He said he expected his passenger count by the end of March to be around 25% of its pre-COVID levels and that he would fly to nearly 45% percent of his destinations. before the crisis.

(Reporting by Scott Murdoch in Hong Kong and Anshuman Daga in Singapore; Editing by Michael Perry and Simon Cameron-Moore)

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