Genting Bhd - Completes book-building for RM2mil MTN BUY

- Genting Bhd has completed the book-building process for the issuance of its medium-term notes (MTN). 

- The total size of the MTN is RM2bil, to be issued in two tranches. 

- The first tranche is RM500mil while the second tranche will be RM1.5bil. 

- The MTN will be issued at par. 

- Coupon rate for the first tranche is 4.42% p.a. while the second tranche will command a coupon rate of 4.86%.

- Issue date of the MTN is 8 June 2012.  

- During the conference call recently, Genting Bhd indicated that they would be using part of the MTN proceeds to repay its US$300mil (RM945mil) bonds, which are due in FY14F. 

- As for the balance RM1bil of the MTN proceeds, Genting Bhd does not have any plans in mind yet. 

- The group is taking advantage of low borrowing costs in the market to raise funds.  

- Impact of the MTN on Genting Bhd’s net profit is insignificant. 

- We estimate that coupon payments arising from the coupon rates of 4.42% to 4.86% on the two tranches would only reduce Genting Bhd’s FY13F net profit by 2%. 

- We maintain a BUY on Genting Bhd. 

- We believe that the recent fall in Genting Bhd’s share price represents a good opportunity to accumulate.   

Source: AmeSecurites