CapitaMall Trust in an aggressive refinancing scheme

Proceeds from a fixed note issuance will be used to partially refinance the S$783m secured term loan maturing in Oct 2012.

CapitaMall Trust would issue HK$1.15b 3.76% Fixed Rate Notes due 2022. The proceeds would be swapped into SG$190.1m at a fixed 3.45% rate and used to partially refinance the S$783m secured term loan maturing in Oct 2012.

CMT also recently completed the sale of Hougang Plaza for S$119.1m, resulting in a gain of S$83.8m. Proceeds would be used to repay debt and fund potential acquisitions.

Here's more from from OCBC Investment Research:

Refinancing – so far so good. CapitaMall Trust recently announced that it would issue HKD1.15b 3.76% Fixed Rate Notes due 2022 under its US$2b Euro-Medium Term Note Program. The proceeds would be swapped into SG$190.1m at a fixed 3.45% rate and used to partially refinance the S$783m secured term loan maturing in Oct 2012. It's noted that CMT’s refinancing is going smoothly with interest costs mostly in line with its current average of 3.3%, which would consolidate its balance sheet position and lengthen the average term to maturity of its debt structure.

Hougang Plaza divestment further consolidates balance sheet. CMT also recently completed the sale of Hougang Plaza for S$119.1m, resulting in a divestment gain of S$83.8m. Proceeds would likely be used to repay debt and fund potential acquisitions. Taking this into perspective, with S$1.2b of cash already on its balance sheet and its share price trading at a relatively tight yield of 5.6%, CMT’s deployment of the sales proceeds could potentially shed further light on the odds of making a bid for its parent’s stake in the ION ahead.

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