Proceeds will go to general corporate purposes.
BreadTalk Group has announced an issuance of $75m 4.60% notes due 1 April 2019, pursuant to the $250m multicurrency medium term note programme established in 2014.
According to a report by OCBC, net proceeds arising from the issue will be channeled toward general corporate purposes, including refinancing existing borrowings, and financing capital expenditure and general working capital.
With this issue, approximately $3.5m of additional interest expense would be incurred per year, adding some pressure to bottom-line.
Moreover, while BreadTalk is focused on rebranding, improving cost rationalisation and productivity, OCBC still forecasts the usual drags from gestation, depreciation, and potential consolidation.
As of 31 december 2015, the group’s net debt/equity was at 0.83x.
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