2010/07/22

Temasek launches landmark 40-year bond

SINGAPORE, July 22, 2010 (AFP) - State-linked investment giant Temasek Holdings on Thursday announced a 40-year bond worth one billion Singaporean dollars (727 million US) priced at 4.2 percent a year.

The bond, due to expire in August 2050, is the first corporate bond priced in the local currency to have such a long duration, Temasek's treasury head Alyssa Ong said in a press release.

"We are delighted to pioneer the longest-dated SingDollar corporate bond to date," she said.

Proceeds from the bond will be used to fund Temasek and its investment holding companies' "ordinary course of operations," it added.

The bond has been give top ratings by global credit ratings agencies Standard & Poor's (S&P) and Moody's Investors Service.

"The 'AAA' corporate credit rating and stand-alone credit profile on Temasek reflect the company's exceptional liquidity position, highly diversified and liquid investments," S&P said separately.

"In addition, most of Temasek's major investments have strong business risk profiles, with steady and sustainable cash flows."

The latest offering is the eleventh under a 10-billion-US-dollar bond programme, Temasek said.

One of the world's largest sovereign wealth funds, Temasek earlier this month announced a 26-percent dive in profits for the year ended March after being battered by the global financial crisis.

However, the collective value of its investments worldwide reached a record high of 186 billion Singaporean dollars (134 billion US), up by 56 billion dollars, or 43 percent, from 130 billion dollars a year ago.

Most of Temasek's investments are in Singapore and Asia. It has stakes in leading companies including Standard Chartered bank and flag carrier Singapore Airlines.