SIA prices $850m convertible bonds at 1.65%

More than 148 million new shares will be issued.

Singapore Airlines (SIA) has priced its proposed issue of convertible bonds at an interest of 1.625% per annum, payable semi-annually in arrear, according to a bourse filing.

Initial conversion price is at $5.743 for each new share, and conversion premium is 45.77% over the last closing price of the shares quoted at the Singapore Exchange Securities Trading Limited (SGX-ST).

The number of new shares to be allotted and issued is at more than 148 million, representing approximately 5% of the existing issued shares, SIA said.

Conversion period is after 41 days after the date of the issue of the bonds up to the close of business on the 10th day before the maturity date.

SIA plans to use the proceeds of the issue to fund operating cashflow, debt service, and capital expenditure. Approximately 60%-80% will be used for operating cashflow and debt service and 20%-40% for capital expenditure.