by Professor Ian H. Giddy
DBS Bank, as
arranger for the retail
offering of the S$ PENs, wishes to announce the terms for the offering
of US$765 million principal amount of PENs to be issued by Finlayson
Corporation Limited (a wholly-owned subsidiary of Temasek), and
for ordinary shares of DBS Bank.
the PENs is
100% of the principal amount of the PENs. The offering size, yield to
redemption price, initial exchange price and initial exchange premium
the PENs are as follows:-
Further details of the terms of the PENs are set out in the Appendix.
The PENs are
by the Government of the Republic of Singapore. The PENs are expected
be assigned on issue a rating of "AAA" by Standard & Poor’s Ratings
Services and "Aaa" for the S$ PENs and "Aa1" for the US$ PENs and Euro
PENs by Moody’s Investors Service, Inc.
part of the Government’s
ongoing privatisation initiative that will enable it to divest part of
the non-voting convertible preference shares received as consideration
for the transfer of POSBank to DBS Bank in November 1998. The
shares underlying the PENs are exchangeable into
approximately 10% of
Bank’s enlarged ordinary share capital.
a novel feature
which gives investors an option to convert their PENs into cash-settled
zero strike warrants should they be restricted from owning local shares
at the time of exchange. The warrants give the holders the economic
to the underlying shares for another 5 years from the maturity of the
but not the voting rights. The warrants are expected to be listed on a
recognised stock exchange overseas. Although this option is designed to
address the restrictions on foreign ownership, local investors (other
investors who use their CPF funds to purchase the PENs) may also opt
the warrants in lieu of local shares or cash settlement.
The S$ PENs
of up to S$30 million are set aside for a retail offering to the public
in Singapore. The issuer has the discretion to increase the maximum
size from S$30 million to S$50 million depending on demand.
for these PENs, available in lots of S$10,000, can only be made from 9
am on 11 February 1999 to 12 noon on 18 February 1999 at the ATMs of
Bank (including its POSBank Services division), Keppel TatLee Bank
Oversea-Chinese Banking Corporation Limited Group, Overseas Union Bank
Limited and United Overseas Bank Limited Group. Each application to
for the S$ PENs may be paid in cash, by CPF funds or a combination of
Where an applicant elects to use a combination of cash and CPF funds,
respective amount for each method of payment must be an integral
of S$10,000. S$ PENs subscribed with CPF funds may not be exchanged for
have an existing
bank account and hold an ATM card with one of the participating banks
above. In addition, he must maintain a Securities Account with the
Depository ("CDP") in his own name at the time of application and a CPF
Investment Account with the relevant participating bank if he wishes to
apply using CPF funds.
"This document is not an offer of securities for sale in the United States. The Securities are not being registered under the US Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the United States or to or for the account or benefit of US persons (as such terms are defined in Regulation S under the Securities Act) unless registered under the Securities Act or pursuant to an exemption from such registration. The Issuer does not intend to register the Securities under the Securities Act."