Siam Cementís Refinancing


COMPANIES & FINANCE: ASIA-PACIFIC: Siam Cement to issue up to Dollars 1.3bn domestic bonds
Financial Times ; 27-Jan-2000

Siam Cement, Thailand's leading producer of cement, petrochemicals and pulp and paper, is to issue up to 50bn baht (Dollars 1.34bn) of domestic bonds with a maturity of no more than 20 years, after gaining board approval yesterday, Reuters reports from Bangkok.

"We still see a good market for bonds in the domestic market and would want to take this opportunity to lower our foreign exposure, which currently stands at Dollars 1.8bn," said Aviruth Wongbuddhapitak, the company's chief financial officer.

No further details were given about the interest rates or timing of the issue.

Mr Aviruth said: "We have a foreign exposure of about Dollars 1.8bn, while our foreign exchange revenues are about Dollars 1bn. We need to lower this gap to lower the risk of volatility."

Siam Cement had a total foreign debt exposure of about 140bn baht at the beginning of 1999, which it has been trying to cut back. The company issued 50bn baht in bonds in 1999, which were oversubscribed.

Analysts reckon there will also be strong demand for the latest offering.

Mark Lavoie, building and furnishing analyst at Asset Plus Securities, said the issuance of the bonds should bode well for the company as it would help Siam Cement refinance with debts of a longer maturity date and lower interest rates.

"There is a great deal of appetite for bonds issued by Siam Cement," Mr Lavoie said. "I think it would be oversubscribed this time as well."

Mr Aviruth said the move to issue the bonds was not aimed as a substitution for the issue of 30m new shares that the company planned to sell to foreign investors, which will still go ahead when market conditions improve.

Bangkok Post - Thailand ; 05-Jan-2000

The Siam Cement Group (SCG) said yesterday that individual investors had shown good response to its 50 billion baht in debentures now being traded in the secondary market, due to high liquidity with selling prices above the subscription prices.

From Oct 1 to Dec 1, about one million units, each with a face value of 1,000 baht, had been traded at Siam Commercial Bank. The active trading was due primarily due to the higher yields compared with bank deposit rates, the company said.