Sembcorp Marine (Sembmarine) has clinched a SGD2bn ($1.5bn) loan from its largest shareholder Sembcorp Industries to help bring down its debt.
Of the SGD2bn five-year subordinated loan facility, Sembmarine will be using the loan to retire approximately SGD1.5bn of borrowings, and the balance SGD500m for working capital and general corporate purposes.
Sembcorp Industries will issue SGD1.5bn of bonds to DBS Bank as sole lead manager and initial purchaser through a private placement. The investors of the bonds include Temasek Holdings, owned by the Singapore government.
“Assuming the SGD2bn is fully drawn as at 31 March 2019, Sembcorp Group’s gross debt-to-capitalisation ratio would increase from 56% to 58%,” Sembmarine and Sembcorp said in a joint statement.