Temasek raises S$650mn via Zero Coupon Guaranteed Exchangeable Bonds

Proceeds of the bonds due 2014 will be used by Temasek and its investment holding companies to fund their business.

Temasek Holdings (Private) Limited (“Temasek”) has placed out S$650 million Zero Coupon Guaranteed Exchangeable Bonds due 2014 (“TEB2014 – STAN LN”) to institutional investors through its wholly-owned subsidiary, Temasek Financial (III) Private Limited (“TFin-III”).

TFin-III has granted to the Lead Manager a greenshoe option to increase the size of the issue by up to an additional S$150 million, exercisable anytime prior to the date which is 14 days after the settlement date. If exercised in full, the gross proceeds of the issue would be S$800 million, according to a Temasek report.

TEB2014 – STAN LN will be issued at par. TEB2014 – STAN LN will, upon exercise of the exchange rights thereunder, be exchangeable for ordinary shares, par value of US$0.50 cents each, of Standard Chartered PLC (“Company”). TFin-III may, at its option, elect to cash settle any exercise of the exchange rights. The payment and exchange obligations of TFin-III under the TEB2014 – STAN LN will be unconditionally and irrevocably guaranteed by Temasek. Unless previously exchanged or redeemed, TEB2014 – STAN LN will be redeemed at par 3 years from the settlement date. TEB2014– STAN LN will carry a zero coupon.

The exchange price of S$36.2912 per Company share has been set at a 27% premium over the closing price of GBP14.29 per Company share on 17 October 2011 converted at an exchange rate of GBP:SGD 1.9997. The maximum number of Company shares that may be deliverable upon exchange will initially be about 17.9 million (assuming no exercise of the greenshoe option) and about 22.0 million (assuming full exercise of the greenshoe option).

TFin-III intends to provide the net proceeds from the issuance of TEB2014 – STAN LN to Temasek and its investment holding companies to fund their ordinary course of business.

Temasek has had an overall corporate credit rating of AAA/Aaa by Standard & Poor's and Moody's Investors Service respectively since 2004, which is supported by Temasek’s conservative balance sheet, very strong liquidity and high-quality investment portfolio. The offering is scheduled to close on 25 October 2011.

TEB2014 – STAN LN were offered outside the United States only to non-U.S. persons under Regulation S of the U.S. Securities Act of 1933, as amended, and in the United Kingdom TEB2014 – STAN LN were offered exclusively to qualified investors (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) who fall within Article 49(2)(A) to (D) of the Order, and (iii) to investors to whom TEB 2014 – STAN LN could otherwise lawfully be offered.

The Lead Manager is Bank of America Merrill Lynch, acting as sole bookrunner, as stabilizing manager and settlement agent in connection with the placement of TEB2014 – STAN LN.